Imported iron ore margin narrows to 0.04 yuan/mt

The average imported iron ore margin narrowed from 8.72 yuan/mt to 0.04 yuan/mt in the latest period, weighed down mainly by lower port spot prices and higher freight.

Iron ore currently faces rising supply and falling demand. The latest SMM data showed iron ore stocks at 35 major ports across China at 148.05 million mt, up 300,000 mt from the previous survey, marking a slight build. Average daily port outbound volume fell 35,000 mt to 3.175 million mt. Iron ore fundamentals remain bearish. With hot metal output expected to decline further next week, iron ore demand may continue to weaken, capping upside for prices. Macro factors also lack a stronger driver, and prices are expected to remain range-bound next week.

News on long-term contract negotiations and environmental production curbs in northern China could still disrupt prices. The import margin is likely to narrow gradually in the short term as freight rates rise. Source: SMM

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