SHANGHAI, Apr 18(SMM) - The domestic iron ore prices inched higher last week, except for a 50 yuan/mt drop in Tangshan.
Last week, steel mills in Tangshan began to replenish imported iron ore as the transportation recovered after the pandemic situation improved, which weighed on the demand and prices of local iron ore. For example, Hebei Xinda Iron and Steel, who frequently raised its purchase prices of domestic ore as the local ore was the only option amid hindered cross-regional transportation, lowered its purchase prices by 50 yuan/mt to 1,250 yuan/mt (dry basis, including tax, delivery to factory) last Monday as it preferred imported ore after the transportation restrictions were loosened. In contrast, iron ore prices in Hebei’s Handan and Shahe rose as the COVID-19 lockdown boosted steel mills’ demand for local ore.
Recently, the Central Commission for Discipline Inspection stated that the relevant departments shall strengthen supervision and law enforcement in response to the sharp rise in iron ore and thermal coal prices, which may suppress sentiment in the iron ore market. It will be less difficult for steel mills to obtain iron ore after the logistics issues are alleviated, hence the domestic ore prices may drop slightly this week.