Iron Ore Futures Rise amid Low Arrivals

SHANGHAI, Feb 21 (SMM) - Iron ore futures prices rose yesterday, with the most-traded 2305 iron ore contract closing with gains of 1.02% at 894 yuan/mt. Traders were active in delivery while steel mills purchased cautiously, hence the market transactions were modest. The transaction prices of PB fines in Shandong were mainly 895-900 yuan/mt, which was 5-10 yuan/mt higher than last Friday, while the PB fines in Tangshan were sold at 905-910 yuan/mt, up 8-10 yuan/mt from last Friday.

SMM statistics showed that the global iron ore shipments totalled 27.02 million mt, an increase of 7.8% week-on-week. Among them, the imports from Australia to China stood at 15.15 million mt, up 7.1% from the previous week, the imports from Brazil totalled 5.89 million mt, up 5.8% on the week. However, due to the reduction in shipments in the previous period, the arrivals in the current period was 28.52 million mt, a decrease of 1.06%. The shipments were still at an annual low despite the slight increase. It was rumoured yesterday that heavy rains in Brazil caused floods in some areas, which may affect the shipment of mines. On the demand side, the steel mills produced stably, but the increase in pig iron output was limited. Considering that the demand for rebar was in the recovery period and the market sentiment was positive, it is expected that short-term iron ore prices will still increase.