Iron ore price

Iron ore price, steel price and futures published daily

The contemporary seaborne iron ore price first emerged in 2003 when the Chinese development model shifted up a gear. Indian suppliers broke free of an annual contract pricing system that had been dominated by Australia, Brazil and Japan for decades.

As Chinese demand surged, traditional supply and pricing mechanisms could not keep pace. Indian miners in Goa and Karnataka had surplus supply and filled China’s marginal new needs outside the old benchmarking system.

But it still wasn’t enough and other non-traditional suppliers began to emerge in South America and Africa. These needed more dynamic pricing mechanisms and by 2008 Platts, Metal Bulletin and The Steel Index were publishing a daily iron ore price.

As the Chinese demand surge continued, by 2007, major Australian iron ore miners were charging enormous premiums to prices from five years earlier. The annual benchmarking system began to strain to the point breaking, including significant diplomatic tensions between Australia and China. This culminated in a proposed merger of BHP and RIO Tinto which triggered panic in Beijing as it feared an already supply-constrained market and soaring iron ore price would by made worse by monopoly pricing. The Chinese SOE, Chinalco, moved the buy a blocking stake in RIO Tinto.

However, the GFC intervened and deflated tensions as Chinese demand collapsed. But Chinese steel mills found themselves still tied to very high prices and an annual iron ore price benchmark that did not reflect the new reality. Many defaulted on cargoes and walked away from deals.

To fight the downturn, China unleashed an enormous fiscal and monetary stimulus that soon had China building more than ever. The demand for iron ore rocketed to all new highs. With the memory of contract defaults fresh in their minds, major Australian miners, led by BHP and CEO Marius Kloppers, abandoned the annual benchmarks, forcing Chinese steel mills to adopt a short term iron ore price using spot and quarterly contracts. Brazil joined in in 2010.

The spot iron ore price soared to all new highs and triggered a global wave of new supply from producers such as Fortescue Metals Group, Ferrexpo, Kumba Iron Ore, Anglo American and Sino Iron.

With the rise of the short term iron ore price market, iron ore derivative markets grew. First in the Singapore on the SGX and later in China as the Dalian Commodities Exchange and the United States at Chicago Commodities Exchange (CME). Iron ore derivatives could hedge and future price iron ore output.

These last developments coincided with the peak in the China boom and prices began to fall from 2012. After peaking above $190 per tonne, the iron ore price collapsed into the $30s in 2015 as new supply outstripped demand.

Ahead were still many years of oversupply, a lower iron ore price, consolidation and mine closures.

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Daily iron ore price update (down she goes)

The ferrous  complex broke on August 3, 2022: The dream is over. We’re just waiting for the market to wake up: China’s steel industry is entering a precarious new era as a worsening property crisis imperils demand and Beijing’s construction-led growth model looks increasingly untenable. Almost a third of China’s steel mills could go into


Daily iron ore price update (PMI hellfire)

The ferrous complex flamed out on August 1, 2022: For damn good reason. Check out the latest Chinese steel PMI: Judging from the steel industry PMI surveyed and released by the China Federation of Steel and Logistics Professional Committee, July 2022 is 33.0%, down 3.2 percentage points from the previous month, and the operation of


Daily iron ore price update (Dalian rip)

The ferrous complex was strong on Friday 22nd of July: Dalian futures went berserk on Friday night for this: A State Council meeting chaired by Premier Li Keqiang Thursday called on local governments to ensure construction and supply chains won’t be interrupted and that more job opportunities be provided to migrant workers, state broadcaster CCTV


RIO warns

So predictable. All commodity cycles work this way: Rio in effect conceded on Friday that the cost of exporting iron ore from Western Australia this year would be about 5 per cent higher than previously expected. The rising cost was implied when Rio retained its promise to keep unit costs between $US19.50 and $US21 per


Daily iron ore price update (annihilation)

The ferrous complex was annihilated on July 14, 2022: The steel crash is leading us lower. Here is September Shanghai rebar: The Chinese property crash is intensifying as it sweeps toward banks. Steel demand is directly in its path. As the broader commodity mania implodes under Fed pressure, the bulk commodities are freed to fall


Daily iron ore price update (Vale exports down)

The iron ore complex was able to rebound on Thursday with a near 2% increase in spot prices, while Dalian prices leaped 5% and futures nearly 2%:   Meanwhile, iron ore inventories are up at Chinese ports, but just barely: On July 4, inventory of iron ore at 33 major Chines ports amounted to 115.7


Daily iron ore price update (lowest for the year)

Iron ore prices slumped alongside other commodity prices yesterday, to its lowest level for the calendar year as more COVID concerns in China amid further lockdown worries just after Shanghai pushed through a two month event. Interestingly though, Dalian futures had a wild ride in yesterday’s trade as the spot price pulled back, with other


Daily iron ore price update (Simandou slips)

The iron ore complex recovered with a 4% rise in spot prices, led by news that Brazil’s exports of the precious metal (sic) had taken a tumble, combined with another stoppage of the Simandou project in Guinea. Here are the latest prices: ING has the skinny on both Australian and Brazilian supply, as Chinese steel


Daily iron ore price update (inventories rising)

The iron ore complex suffered another round of selling on Monday, with the impact of closed mills and increased shipments pushing inventory higher:     Texture from Reuters: Chinese mills have idled dozens of blast furnaces as stocks piled up after domestic demand weakened, hit by covid-19 restrictions and bad weather. The rising prospect of