Iron ore spot markets went into reverse on Wednesday, falling heavily after three days of strong gains.
According to Metal Bulletin, the price for benchmark 62% fines tumbled 2.06% to $64.05 a tonne, completely reversing Tuesday’s gain.
58% fines fell by a smaller 1.15% to $44.69 a tonne while Brazilian ore with 65% Fe content bucked the trend with an increase of 0.12%.
Metal Bulletin said that weakness came despite further gains in Chinese steel markets.
“The price of billet rose to a five-year high on Tuesday after a steady pace of increase in the past few days, which pushed up spot rebar prices,” said the group, citing market participants.
“Trading activity fell, however, due to expectations among buyers that prices are likely to drop soon due to the seasonally weak demand.”
That may explain the pullback seen in Chinese rebar, iron ore and coking coal futures during Wednesday’s session, with all contracts closing well off the highs seen earlier in the day.
Providing little indication as to whether the weakness in iron ore spot markets will continue today, futures were largely unmoved in overnight trade from Wednesday’s day session close.
Here’s the final scoreboard.
SHFE Rebar ¥3,592 , 0.28%
DCE Iron Ore ¥487.00 , -0.81%
DCE Coking Coal ¥1,158.50 , 0.48%
DCE Coke ¥1,853.50 , -0.32%
Trade will resume at 11am AEST, around a hour before the release of Chinese international trade figures for June.