Iron ore prices remain choppy

Michael Urban/AFP/Getty Images
  • Iron ore spot markets traded mixed on Wednesday. Higher grades strengthened while others fell.
  • Chinese futures are also choppy, providing little direction for physical markets.
  • Macquarie Bank says the days of extreme volatility in iron ore markets may now be over.

Iron ore spot markets traded mixed on Wednesday with higher grades outperforming over the session.

The price for benchmark 62% fines fell 0.4% to $68.96 a tonne, according to Metal Bulletin, leaving it at a two-week low.

Fresh from hitting the highest level since March on Tuesday, the price for 58% fines consolidated on recent gains, losing a solitary cent to settle at $40.97 a tonne.

In contrast, higher grades rebounded after falling a session earlier with the price of 65% Brazilian fines lifting 0.4% to $96.20 a tonne.

The mixed performance in spot markets followed continued weakness in Chinese steel futures on Wednesday.

Rebar futures in Shanghai fell to as low as 4,027 yuan at one point during the session, a level not seen since September 13. The January 2019 contract eventually finished at 4,064 yuan, almost unchanged from Tuesday’s night session close of 4,062 yuan.

After sliding on Tuesday, iron ore futures in Dalian eked out modest gains, finishing the session at 500 yuan. Coking coal futures also pushed higher, closing at 1,286.5 yuan, although coke futures went in the other direction, finishing at 2,286 yuan.

As seen in the scoreboard below, rebar and iron ore futures continued to gain in overnight trade while coke and coking coal contracts lagged.

SHFE Rebar ¥4,073 , 0.44%
DCE Iron Ore ¥503.00 , 0.20%
DCE Coking Coal ¥1,274.50 , -0.89%
DCE Coke ¥2,289.50 , -0.43%

The mixed price action provides few clues as to what direction spot markets will travel on Thursday.

Trade in Chinese futures will resume at 11am AEST.

NOW READ: Macquarie explains why volatility in iron ore markets could now be over

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