|
1. Iron
Ore Market
1.1 Market
in Brief
Seaborn iron
ore prices plummeted in China last week. For mills, most of them started
iron ore procurements which would arrive at China’s ports in November,
bringing the transactions at a normal level.
On the spot
market, the price kept decreasing by and large. With the bearish
outlook, most traders were active in sales. The overall transactions
were slack on the market.
T1: China Iron Ore Price by
Product
|
|
SteelHome Index (USD/t) |
Seaborne Price (USD/t) |
Qingdao Port (yuan/t) |
Tangshan (yuan/t) |
|
62%-Fe
Imported Iron Ore |
61.5%-Fe PB fines |
65%-Fe
IOCJ |
61.5%-Fe PB fines |
56.5%-Fe Super Special fines |
66%-Fe
Concentrate fines |
|
September 25 |
117.52 |
116 |
990 |
890 |
815 |
1040 |
|
September 18 |
124.78 |
123.5 |
1020 |
920 |
830 |
1050 |
|
VAR |
-7.26 |
-7.5 |
-30 |
-30 |
-15 |
-10 |
Source: SteelHome Database
*Need More Data? Just
Click SteelHome
Database (Microsoft's Windows Version)
1.2
Seaborne Transactions
Seaborne iron
ore transaction was 1.99 million tons during September 21-25, down by
8.8% week on week.
T2: Seaborne Iron Ore Transaction
|
Date |
Product |
Volume
(10,000 Tons) |
Price
(US$/dmt) |
Note |
|
2020/9/21 |
Newman lump |
8 |
October 62%Plarrs average index + lump premium 0.05 |
globalORE bidding price, with laycan during October 14-23. |
|
2020/9/21 |
Jimblebar fines |
11 |
October index +0.2 |
COREX bidding price, with laycan during October 16-25. |
|
2020/9/21 |
Newman lump |
13 |
October index +0.2 |
COREX bidding price, with laycan during October 16-25. |
|
2020/9/21 |
62%-Fe BRBF |
17 |
120.05 |
COREX bidding price, with laycan during October 13-22. |
|
2020/9/22 |
PB lump |
10 |
October 62%Platts average index + lump premium 0.2 |
COREX bidding price, with laycan during October 1-10. |
|
2020/9/22 |
PB fines |
17 |
November 62%Platts average index + 4.1 |
globalORE bidding price, with laycan during October 26-November
4. |
|
2020/9/23 |
Mac fines |
9 |
November 62%PM average index + 1.35 |
COREX bidding price, arrival at ports in November. |
|
2020/9/23 |
Yandi fines |
10 |
November 62%PM average index + 1.65 |
globalORE bidding price, arrival at ports in November. |
|
2020/9/23 |
61%-Fe PB fines |
17 |
110.6 |
COREX bidding price, with laycan during October 25- November 3. |
|
2020/9/23 |
PB fines |
17 |
November 62%Platts average index + 4.15 |
COREX bidding price, with laycan during October 25- November 3. |
|
2020/9/24 |
65%-Fe IOCJ |
8 |
128.9 |
globalORE bidding price, with B/L on September 3 |
|
2020/9/24 |
62%-Fe PB fines |
17 |
113.8 |
globalORE bidding price, with lay can during October 27 -
November 5. |
|
2020/9/25 |
Jimblebar fines |
9 |
November 62%PM average index – 1.95 |
globalORE bidding price, arrival at ports in November. |
|
2020/9/25 |
Yandi fines |
9 |
November 62%PM average index + 1.8 |
COREX bidding price, arrival at ports in November. |
|
2020/9/25 |
Jimblebar fines |
10 |
November 62%PM average index – 1.7 |
globalORE bidding price, arrival at ports in November. |
|
2020/9/25 |
PB fines |
17 |
November 62%Platts average index + 4.3 |
COREX bidding price, with laycan during October 28-November 6. |
1.3
Inventory at Main China’s Ports
According to SteelHome survey, iron ore inventory at
46 main Chinese ports was 120.3 million tonnes as of September 24, 2020,
up 2 million tonnes from September 17.
Of the stocks, about 55.9 million tonnes belong to
traders. The stocks comprise 24.9 million tonnes of lump, 10.5 million
tonnes of pellet and 11.2 million tonnes of concentrate fines. Daily
shipment was 2.91 million tonnes, down 100,000 tonnes from the previous
week.
Meanwhile, daily iron ore arrivals at five largest
Northern ports (Qingdao, Rizhao, Tianjin, Caofeidian and Jingtang)
reached 1.6 million tons this week, up 10,000 tons from last week.
More details, please go to…>>
1.4
Inventory in Steel Mills
From SteelHome survey in North China, iron ore
stockpiles would support around 20 days’ consumption in the leading
local steel mills. Alongside
Yangtze River, iron ore stockpiles remained at around 25-30 days’
consumption in long-term contract steel mills, and at around 20-25 days’
consumption in mills who purchase iron ore mainly in spot market.
1.5
Forecast & Trading Tips
Factors
causing iron ore price to drop: (a) production curbs in Chinese steel
mills; (b) restricted shipments out of ports; (c) portside iron ore
stockpiles above 120 million tonnes which may further rise; (d) active
iron ore sales amid bearish outlook.
Factors
causing iron ore price to rise: (a) robust demand amid high steel
output.
Therefore, SteelHome
considers that prices of 62%-Fe imported iron ore would be at 113-118
dollars per tonne next week.
Trading Tips: traders are
suggested to properly sell iron ore products. Mills are suggested to
keep the in-plant inventory at a normal consumption level.
2. Semis
Market
2.1 Price
& Inventory
Prices of
semis slumped last week. In Tangshan, the spot price sharply decreased
due mainly to the dropped steel futures price lately. Currently, steel
rolling mill plants are inactive in preholiday restocking operations
amid slack steel sales, keeping the in-plant stockpiles at a normal
consumption level.
Semis stocked at 16 large
warehouses in Tangshan were 632,400 tons in the week ended September 24,
2020, down around 95,500 tons from September 17, 2020, and up 291,000
tons from the same period last year.
T3: China Domestic Semis Price
|
in
Yuan per tonne |
Shanghai |
Jiangsu |
Shandong |
Fujian |
Guangdong |
Henan |
Hebei |
Shanxi |
Liaoning |
|
September 25 |
3490 |
3430 |
3380 |
3460 |
3500 |
3380 |
3330 |
3360 |
3330 |
|
September 18 |
3530 |
3470 |
3430 |
3510 |
3550 |
3430 |
3380 |
3410 |
3380 |
|
VAR |
↓40 |
↓40 |
↓50 |
↓50 |
↓50 |
↓50 |
↓50 |
↓50 |
↓50 |
T4: Tangshan Semis Inventory
|
in
10,000 tons |
Aug. 6 |
Aug.
13 |
Aug.
20 |
Aug.
27 |
Sep. 3 |
Sep.
10 |
Sep.
17 |
Sep.
24 |
|
Inventory |
57.87 |
62.09 |
66.45 |
70.1 |
71.97 |
75.41 |
72.79 |
63.24 |
|
VAR |
5.92 |
4.22 |
4.36 |
3.65 |
1.87 |
3.44 |
-2.62 |
-9.55 |
2.2
Profits
In last week,
prices of coke remained stable, while iron ore prices dipped in
Tangshan. Therefore, the calculated cost of semis was about 2,928 yuan/t
without tax, down by 46 yuan/t from the one in week prior, bringing
gross profits around 100 yuan/t for semis suppliers.
2.3
Outlook & Trading Tips
Factors
causing semis price to fall: (a) steel demand being weaker than
forecast; (b) tightened real estate policies.
Factors
causing semis price to rise: (a) production cuts in steel mills; (b)
great macro fundamentals.
SteelHome considers that
prices of semis would fluctuate, with range around 20 yuan/t next week.
Trading tips: consumers are
suggested to purchase semis products mainly as needed in the near term
amid escalating market uncertainties. |
