- Iron ore spot markets edged lower on Wednesday.
- The up-streak in 58% fines came to an end at eight sessions. Prices had closed at multi-year highs on Tuesday.
- Chinese iron ore futures pushed higher in overnight trade.
Iron ore prices fell across the board on Wednesday, albeit the declines were modest.
According to Metal Bulletin, the spot price for benchmark 62% fines slipped 0.4% to $74.48 a tonne, easing lower for a second consecutive session.
Weakness was also evident across higher and lower grades. 65% fines fell 0.2% to $88.70 a tonne while 58% fines skidded by a larger 0.8% to $52.94 a tonne, pulling back from multi-year highs struck on Tuesday.
Lower grades had risen in each of the past eight sessions.
“Low [profit] margins will see Chinese steel mills prioritise affordability over productivity and emission reduction. That will see mills move to low grade ore, a trend that has already resulted in mid-grade and high-grade iron ore premiums falling,” said Vivek Dhar, Mining and Energy Commodities Analyst at the Commonwealth Bank.
The modest moves in physical markets mirrored the price action in Chinese steel and bulk commodity futures on Wednesday.
Rebar and hot-rolled coil contracts finished trade at 3,644 and 3,559 yuan respectively, almost unchanged from where they closed on Tuesday evening.
Movements in the bulks were similarly subdued with iron ore finishing the session where it started.
Coking coal and coke futures had a little more perk, lifting modestly to 1,232 and 2,043 yuan respectively.
As seen in the scoreboard below, Chinese futures, with the exception of coking coal, all ground higher in overnight trade on Wednesday.
SHFE Hot Rolled Coil ¥3,574 , 0.51%
SHFE Rebar ¥3,657 , 0.38%
DCE Iron Ore ¥534.00 , 1.33%
DCE Coking Coal ¥1,227.00 , 0.41%
DCE Coke ¥2,048.00 , 0.64%
Trade in Chinese commodity futures will resume at midday AEDT.