A total of 590,000 mt of iron ores was traded for the week ended Oct 1, down 2.67% on-week, due to short week as Chinese trade participants celebrated their week-long holidays.
Restocking activities slowed down as the holidays approached in early October, while the power crunch and ongoing steel output cuts affected iron ore demand.
During the week, the trades volume of PB lump accounted the largest market share at 52%, then followed by BRBF at 23%, and Jimblebar fines at 12% too.
Power rationing to affect steel production
According to trade sources, China’s power rationing did not have a huge impact on sintering and blast furnace operations, though it had affected the production of long and flat steel products.
However, Chinese steel mills will usually maintain their operations throughout the holidays, but the nationwide power rationing might disrupt the flows and resulted in more night shifts to avoid peak day time power consumption.
Meanwhile, steel mills tried to save costs and preferred to use medium grade fines instead of the more expensive BRBF, which came in short supply.
More supports for lump premiums
Lump premiums are expected to be supported in view of the winter sintering restrictions, though some end-users were heard to reselling their own cargoes.
However, the reselling did not stop lump demand to gain much traction recently, due to their cost efficiency as compared to the more expensive pellets.
In the meantime, there were some market concerns over the slow unloading activities among the congested Chinese ports, which are likely to result a buildup of port stocks and resulted in some price corrections.
