Cookie & Privacy Policy

This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. View the privacy policy to find out more here.

Kallanish Kallanish

Knowledge matters Knowledge matters

August, 17th 2019

Free Trial Buy Subscription
JAN 30

Vale dam failure drives iron ore


Seaborne iron ore prices jumped on Wednesday. The key driver remained expectations of cutbacks from Vale.

The Kallanish KORE 62 % Fe index jumped $2.25/tonne to $79.88/dry metric ton cfr Qingdao, now the highest level since March 2017. On the Dalian Commodity Exchange May iron ore settled at CNY 578/t ($85.79/t), up another CNY 22/t, while on the Singapore Exchange February 62% Fe futures settled a sharp $4.21/t higher at $83.98/t. Billet prices in Tangshan remained flat for the fifth consecutive day at CNY 3430/t.

The jump in iron ore prices has also given Chinese imported coking coal prices a little boost as high grades achieve a premium. On GlobalCoal, 75,000 tonnes of branded hard coking coal traded at $203.5/t fob Australia for March shipment. That is up from a deal at $197/t fob on 24 January.

Vale expects a total production stoppage of 40 million tonnes/year of ore including feed for 11m t/y of pellet. That leaves it with the opportunity to surprise on the upside however. Any additional shipment will now be measured against elevated prices for premium ore.