Price Difference between Different Grades of Imported Iron Ore to Shrink Further in March

SHANGHAI, Mar 7 (SMM) - By the end of February, the price difference between high and medium-grade ore narrowed 45 yuan/mt to 85 yuan/mt, while that between medium and low-grade ore contracted 15 yuan/mt to 115 yuan/mt.

Entering March, end-user demand continued to improve, and the market is betting on favourable policies during the National People's Congress and the Chinese People's Political Consultative Conference (short as “Two Sessions”), thus steel prices may still have room to rise. Coke prices are also expected to rise as catastrophic coal mine accident in Inner Mongolia triggered coal mine safety inspections. In this context, steel mills will continue to struggle around the break-even point. Therefore, steel mills will still favour medium and low-grade ore. The discount offered by FMG for low-grade ore continued to shrink in March. It is expected that the price difference between high and medium-grade ore will continue to shrink in March, so will the price difference between medium and low-grade ore.