On August 18, S&P Global Platts recorded the highest global iron ore price index since January 2014 at $ 127.60 per dry tonne for 62% iron ore.
Production disruptions in Brazil in the first half of 2020 due to the prolonged rainy season and COVID-19 precautions have put pressure on the overall supply of fine iron ore.
Despite stable shipment volumes from Australia, market sources note that iron ore stocks in Chinese ports have plummeted, especially for medium iron fines, amid heavy dependence of Chinese steelmakers on agglomerated ore in blast furnaces. >
Meanwhile, demand for iron ore is on the rise thanks to a rapid rebound in crude steel production in China since April, with monthly production up 9.1% year-on-year in July to 93.36 million tonnes, according to the National Bureau of Statistics. (NBS) PRC.
Sources explained the favorable prospects for the development of ferrous metallurgy by state support for investment in real estate and infrastructure, as well as the sustainable recovery of key manufacturing sectors after the pandemic.
Chinese import parity-based import ore prices in ports closed on August 19 at 970 yuan per tonne, or $ 131.16 per tonne, $ 3.56 per tonne higher than the IODEX import ore index of the same day.
Purchasing demand is unlikely to decrease in the near future due to good profitability of steel and the approaching seasonal peak in demand for finished steel products in September and October.