The spot price of Indian iron ore registered impressive gain of 4% to 8% during last week.
Despite surge in sea freight, spot prices of Indian iron ore on FOB basis continue to remain strong and have gained 4% to 8% in last week.
Freight rate have climbed to almost USD 26 per tonne taking CFR China prices close to USD 108 per tonne.
Iron ore fines
FOB India
| Grade | Change |
| Fe 63.5/63% | 4% |
| Fe 63.5/62.5% | 4% |
| Fe 63/62% | 4% |
| Fe 62/61% | 4% |
| Fe 61/60% | 4% |
| Fe 60/59 % | 5% |
| Fe 59/58 % | 5% |
| Fe 58/57% | 5% |
| Fe 57/56 % | 5% |
| Fe 56/55% | 6% |
| Fe 55/54 % | 6% |
| Fe 54/ 53 % | 7% |
| Fe 53/52 % | 8% |
Change is on November 20th as compared to November 13th 2009
Factors affecting the iron ore prices are
1. Rise in Chinese domestic steel prices
Chinese domestic steel market has been facing too many ups and downs off late. However, after the last low levels in mid October, prices have recovered by more than 5% in last 30 days
The movement of Chinese domestic prices is tabled below
| Product | 16-Oct | 23-Oct | 30-Oct | 06-Nov | 13-Nov | Gain | % |
| CLPPI | 5627 | 5714 | 5779 | 5830 | 5905 | 278 | 4.9% |
| CFPPI | 5587 | 5689 | 5775 | 5819 | 5932 | 345 | 6.2% |
| CHISPI | 5604 | 5700 | 5777 | 5824 | 5920 | 316 | 5.6% |
CLPPI – Chinese Long Product Price Index
CFPPI – Chinese Flat Product Price Index
CHISPI – Chinese Steel Price Index
As a result, almost all Chinese steel majors have announced price increase, pushing the market sentiments further up, which in turn is supporting higher pries of iron ore.
2. Curtailed availability
Due to Indian iron or mining mess, availability of spot cargoes from India is reported to be curtailed, or at least sellers are successful to some extant in propagating this feeling pushing prices up
3. Increased sea freight
The surge in sea freights is very clearly reflected in the movement of Baltic Dry Index, which has surged by more than 35% in last 15 days
| Date | BDI |
| 1-Oct | 2185 |
| 30-Oct | 3103 |
| 16-Nov | 4220 |
As a result, sea freight from India to China has increased form about USD 16 to USD 24 per tonne, which has further pushed the CFR levels up to about USF 105 per tonne for 63%/62.5% grade.
But it is difficult to say that how long the party would as demand for steel and consequently iron ore, may begin to slow down as some of the construction projects in Northern China are starting to be suspended, due to heavy snowfall.
To know exact levels, likely scenario, domestic iron ore spot prices at Bellary and Barbil and FOB East Coast spot prices subscribe to “Iron Ore Services” of www.steelprices-india.com by registering or sending a mail to admin@steelprices-india.com along with your full contact details. Please note that this is a paid service with subscription charges of USD 600 or INR 30,000 plus ST for 12 months.
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(Sourced from www.steelprices-india.com)
