SHANGHAI, Aug 15 (SMM) - The domestic iron ore concentrate prices varied greatly by region last week. Hebei: +20 - +40 yuan/mt in Tangshan, Qianxi, and Qian'an; +10 yuan/mt in Zunhua; -18 yuan/mt in Hanxing. Liaoning: +30 yuan/mt across Chaoyang, Beipiao and Jianping. Shandong and Anhui: down 10-20 yuan/mt.
In Tangshan, the local dressing plants have generally returned to normal production. But the supply did not improve significantly as previous losses and optimism over the short-term market condition encouraged local mines and processing plants to hold back their cargoes. Steel mills’ demand for iron ore picked up after they resumed their production, forcing them to accept the price hike. Due to the tight supply and high prices in Tangshan, concentrates from other regions began to flow into the local market. However, the prices in Tangshan may stabilise this week as steel mills will turn more cautious about buying due to squeezed profitability following the recent coke price hike.
In west Liaoning, inquiries from traders gradually picked up following the price hike by local steel mills, sending the local concentrate prices up. The operating rates of local mines and dressing plants did not improve substantially as they barely made profits at the current prices. Most of them are planning to either hold back their cargoes or sell to other regions at higher prices. With steel mills gradually resuming their production, SMM believes that there is still room for the local concentrate prices to rise in the short term.
In Shandong, local traders did not show much buying interest as they suffered payment delays from steel mills in Hebei. However, due to the rise in imported ore prices last week, the concentrate prices in Shandong and Anhui may rebound this week.
In view of firm offers by mines and cautious purchases by steel mills following coke price hike, the domestic iron ore prices may be largely stable this week, except for potential rise in east China.