Market Commentary
Iron ore futures tumbled on Tuesday as investors assessed the near-term steel demand outlook ahead of the centenary celebration of the Chinese Communist Party. Mills in the Handan city in the steelmaking province of Hebei, will halt sintering production from 28 to 30 June and output from some blast furnaces will be restricted, according to Mysteel. President Xi is set to deliver an address on 1 July to mark the event. At the same time, some trade participants are concerned over the steel demand outlook as the inventories of hot-rolled coil continue to pile up, reaching a three-month high of 2.79 million metric tonnes last week, up 3.5% from the previous week. This came as heavy rainfall is expected in the southern part of China. Domestic price of Chinese rebar has fallen for the third consecutive week to 4.966 RMB per metric tonne, down 160 RMB per metric tonne from a week ago, indicating weakness in construction steel demand. Investment giant T. Rowe Price Group Inc. also sees growing headwinds facing the global iron ore market. According to its investment analyst, Tom Shelmerdine, the market has peaked with rising Brazilian supply and moderating growth in China likely to spur a retreat over the rest of this year. The investment giant has cut Rio Tinto and Fortescue Metals Group from its flagship Australian Equity Fund for the first time.
Futures in Singapore sank below 206 during London morning. Jul was seen trading around 207 early in the morning, trading down from 207.35 to 206.75 before rebounding to trade as high as 207.75. Iron ore then tumbled, trading down to as low as 205.8. Aug also traded down to 198.5. Spreads were narrower, with Q3/Q4 around 18.15. Jul/Sep was however a touch wider, trading from 14.1 to 14.2. Jul/Aug also traded 7.75 while Aug/Sep traded at 6.45.
Physical Trades
Platform
GO traded 80,000 mt Mac fines, Fe 62% at $202.70/mt for August delivery.
GO traded 170,000 mt PBF Fe 62% at Platts Aug index +$11.15/mt for. Jul 31 – Aug 9 loading.
Click below link to open today’s Singapore Iron Ore Report
https://fisapp.com/wp-content/uploads/2021/06/Iron-Ore-Report-29062021-Eng-Chn.pdf
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FIS Iron Ore Desk
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