Market Commentary
Iron ore rebounded on Tuesday on concerns that the world’s top producers may miss annual export guidance, while there are also market talks of increased usage of higher-grade fines. Supply guidance from major iron ore producers may be under threat due to coronavirus restrictions. UBS Group forecast Vale SA and Rio Tinto Group may miss their export estimates by as much as 10 million tons, with the latter already warning of risks to its target. BHP Group is tracking 3 million tons lower year-on-year, according to the bank. Meanwhile, there is market chatter that the use of less coke in the blast furnace mix could lead to an increase in usage in high-grade fines. However, any gains are largely capped by the bleak demand outlook as China accelerates efforts to cut steel production. So far, the output curbs have been extended to Shangdong, Guangxi, Xinjiang and Sichuan provinces following output cuts in the Chinese cities of Handan and Hebei. Buyers are very cautious in procurement as there is talk that the output restrictions could extend to Jiangsu province.
Iron ore futures rebounded to $136 in Asia on Tuesday and was largely flat in London. Oct was seen traded between 136.25 and 137.25 during London morning. Spreads widened a touch, with 22/23 just under 21.0. Sep/Oct traded at 2.45 and Nov/Dec at 2.2.
Physical Trades
Platform
Corex traded 170kt PBF at $135.45, loading Oct 1-10th.
GO traded 170,000 mt Carajas fines at $160.75/mt , for bill of lading at Sep 1.
Corex traded 80,000 mt Jimblebar fines Fe 60.5% at AM Oct index 62% – $14.90/mt for Oct 1-10 loading.
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https://fisapp.com/wp-content/uploads/2021/09/Iron-Ore-Report-07092021-Eng-Chn.pdf
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