Iron ore futures softened for the second consecutive trading day as trade participants become more cautious after the rally seen last week.
Thus, the most-traded iron ore for January 2021 delivery on China’s Dalian Commodity Exchange dropped by 1.83% or RMB 15.50 day-on-day to RMB 832.50 per tonne on Monday.
However, the steel rebar contract on the Shanghai Futures Exchange stayed almost flat and inched by 0.03% or RMB 1 day-on-day to RMB 3,781 per tonne.
Seeking alternatives feedstocks
Many of the market participants felt that medium grade fines were too expensive and were seeking alternatives feedstocks to lower their costs.
Thus, some mills were heard to lower their dependency on mainstream Australian medium grade fines and replaced them with more discounted mid-grade products such as Jimblebar fines, and low grade products like the Yandi fines and FMG products for blending with concentrates and high grade ores such as Carajas fines.
Therefore, there were much buying opportunities for Brazilian fines as some mills with flexible blast furnace mix tried to increase their utilization of high-grade ores.
More shipment from FMG for coming fiscal year
Australia’s FMG expect its iron ore shipment to reach around 180 million mt for the next fiscal year, July 2020 to June 2021.
The miner issued this statement after reaching a record-high shipment of 178 million mt of iron ore for the fiscal year of July 2019 to June 2020.
The higher annual shipment was attributed to robust steel demand from China as the Chinese economy made a strong comeback amid the coronavirus pandemic.
As such, the miner shipped 17.9 million mt of WPF during the fiscal year of 2019-2020, doubled that of previous fiscal year shipment volume at 9 million mt , which accounted 10% of FMG’s product mix, while the Fortescue Blend and Super Special Fines products accounted for 41% and 33% of total sales.