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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Iron ore prices for December 1, 2020: How high are we going here? Supply should be flowing from Brazil yet here we are rising again to new highs. Chinese steel and iron ore inventories have stopped rising as well so we are pushing out the timetable for the end of the restock. It’s the norm
Iron ore prices for November 30, 2020: Spot up. Paper down. The steel PMI has firmed though remains remarkably weak given steel ouput: No change from me. Strong pricing through Q1, 2021 then down.
Iron ore prices for November 27, 2020: Spot hit a six-year high. Paper is lagging. Steel has not updated. Empties have stabilised again: I wouldn’t expect us to get much higher but it’s quite possible. Especially if we see some Q1 supply disruptions with La Nina. No change from me. Strong pricing through Q1 then
Iron ore prices for November: Spot up. Paper too. We seem to be close to equilibrium here but don’t quote me on it. Empties firmed a little: Is the Pilbara killer more filler? At Caixin: We’ll know soon enough. No change from me. Firm pricing through Q1,21 then down.
Iron ore prices for November 24, 2020: A weak response to the global fireworks from spot. Paper too. Perhaps some of the obvious cooling in underlying Chinese demand drivers is starting to permeate the market. Empties are still trending lower: Moreover, post-COVID global normalisaion is iron ore bearish. We can already see this in China’s
Iron ore prices for November 23, 2020: Spot hit. Paper too. Steel has not updated. Empties are still trending lower: The AFR is all guff all of the time: “We’ve seen China’s steel demand comfortably at all-time highs for some months now,” said NAB head of commodities research Lachlan Shaw. “[But] what was missing was
Iron ore prices for November 19, 2020: Everything up! You will read elsewhere that Chinese demand for steel is booming and that is driving up prices. This is wrong. This is pure seasonality and iron ore is driving up steel prices despite record-high inventories seasonally-adjusted: This is the year-end restock I have warned about for
Iron ore prices for November 19, 2020: Spot up again. Paper stalled overnight. Steel is excited for no apparent reason. There’s still more inventory than at any time ever: And empties are trending lower: I don’t expect activity to fall off a cliff or anything but underlying demand is not going to grow too much
Iron more price for November 18, 2020: Spot up. Paper is getting a bit silly. Steel has not updated. Empties are falling again: It’s not a great trend. It all looks like typical restocking though Vale may have spooked spot again: Another dam break would be disastrous for Vale and highly amusing for Australia during
Iron ore price for November 17, 2020: Spot to the oon. Paper more so. Steel too. Classic year-end restocking with a bit of falling DXY thrown in. Expect strong pricing to continue through NY. Empties are falling: In fact, most China macro data is weakening but I do not expect this catch up to iron
Iron ore prices for November 16, 2020: Empties have crashed again: Indeed, yesterday’s China data showed the real estate sector is fading fast. Prices are barely positive. The leading indicator of developer land sales are down 3.3% YTD. New starts are down 2.6% YTD and roughly flat now YOY for a few months. Chinese realty
Iron ore prices for November 15, 2020: Spot down. Paper stable. Steel too. CISA output remains very high. The reason why is vital to understand. Stimulus was not big enough to explain it. Via Gavekal: The imposition of restrictions on real estate financing has slowed land purchases. Robust growth in real estate fixed asset investment
Iron ore prices for November 12, 2020: Spot down. Paper more. Still waiting on steel. Empties are still fine if cooling: Aussie supply is pouring out with Port Hedland near record highs: No change from me. Firm prices through new year. La Nina risks in Q1. Down from there.
Iron ore prices for November 11, 2020: Spot up. Paper up more. Steel has not updated. Empties are fine: No surprises here. It’s the classic seasonal surge as mills restock for Q1 weather risks. I don’t think prices will go much higher but you never know. No change for me. Firm prices through new year
Iron ore prices for November 10, 2020: Spot up. Paper stalled. Steel has not updated. Empties are still solid: I doubt prices will get much higher despite the year-end restocking pulse. Vale is bringing an extra 50mt or right now. But I still expect firm prices right through Q1 from here, especially if La Nina
Iron ore prices for November 11, 2020: Empties are back bigly: The PBOC has started talking stimulus withdrawal, at Bloomie: China’s central bank once again raised the topic of exiting its monetary easing policies, in sharp contrast to the U.S. and Europe, where a resurgence in virus cases has forced governments there to consider more
Iron ore prices for November 6, 2020: Spot firm. Paper jumped Friday night, presumably on the Biden win, which makes little sense. Rebar is strong. October imports were also strong at 106mt and change. On the US election result, if Biden eases up on China tariffs then that will be bearish for iron ore at
Iron ore prices for Thursday 6, 2020: Everything is pretty much in equilibrium here. Empties included: CISA steel output remains insane: But there are two deal-breakers coming. Vale will be selling at an increased rate of 50mt per annum throughout the fourth quarter after output improvements and having restocked its supply chain. Then it adds
Via The Australian: Uncertainty hangs over Australia’s $149bn in exports to China as a blockade of wine destined for the nation’s biggest trade show in Shanghai has heightened fears that a sweeping ban could follow within days. More than a dozen wine exhibitors at China’s premier trade fair have had their products stopped by Customs
Iron ore prices for November 3, 2020: Spot fell. Paper more. Port inventories are restocking nicely with another six months to run: Empties are fading again. The growth rate trend is down: Brazil had another good month of shipments given October had fewer working days than last year: No change to the outlook. Firm across
Iron ore prices for November 2, 2020: Spot lifted but paper was unchanged. Steel has not updated. The steel PMI improved but is still pretty ordinary: Steel inventories remain huge: Empties are back on track: It looks to me that seasonal weakness is over and restocking has resumed. Expect it to run for another two-quarters
Iron ore prices for October 39, 2020: Spot up but paper down overnight. Steel has rallied in recent weeks so some pressure has come off the seasonal destocking. Empties have rebounded strongly now: The Chinese PMI was solid, driven, as usual, by construction: I will have the more granular steel PMI data tomorrow. So, we’re
Iron ore prices for October 29, 2020: Spot up. Paper to the moon with broader markets. Empties are back on track: Reuters has texture: Iron ore was also supported by lingering concerns over congestion at Chinese ports, and as investors waited for China’s economic blueprint to be laid out at this week’s Communist Party plenum.
Australia could literally bomb Beijing right now and it would happily keep taking our iron ore. The reason is simple. Iron ore is the key commodity input into CCP power. Only by sucking in a billion tonnes of the stuff can it sustain the useless building of empty stuff that keeps folks employed and not
Iron ore prices for October 28, 2020: Spot up. Paper up. Everything up. Empties are back: It is entirely possible that we’ve bottomed here. Year-end restocking is a very powerful force: I can’t see iron ore flying away as global markets melt but buying the crash in miners is a good short term play into
Iron ore prices for October 27, 2020: Spot was firm and everything else soft. Empty apartment sales have rebounded: Whatever the hiccup it is passed. So, I still see weakness over the next few weeks in line with broader markets then a resumption of bullish prices through new year looking for an ultimate top and
Iron ore prices for October 26, 2020: Spot down. Paper firmed overnight as broader markets tanked. Steel is softening. Chinese port inventories jumped above 128mt last week: This remains a bullish story given there is another 32mt to go. That said, the rate of climb is very sharp so mid-2021 will cover it off. Empty
Iron ore prices for October 23, 2020: Spot was down sharply. Paper too. CISA output was still extreme mid-October. Inventories remains stupid My guess is we’re getting ready for a puke lower here. There’s plenty of supply again with much more to come. Chinese demand looks good on an output basis but beneath that leading
Iron ore prices for October 22, 2020: Spot down. Paper down. Empty apartment sales have stabilised but that is not enough. They must grow or steel demand will shrink as catch-up growth rolls off: CISA is bearish: That’s only mill inventories. Trader inventories are also immense, combined for easily the highest ever seasonally-adjusted: There should
Iron ore prices for October 21, 2020: Spot up. Paper up. Really just following broader trends of USD weakness. China’s empties are rebounding: ‘ It looks like sales have been pushed around a lot by stimulus-led discounting waves: But there are still signs of weakness creeping in. Price growth is weak, starts have softened and
