Spot prices of Indian iron ore fines remained stable last week albeit at high note. The transactions remained thin as most of the buyers stayed away combining festive mood and their wait an watch attitude.
The prices having reached nearly USD 177 per tonne to USD 178 per tonne CFR in December riding piggy bank on constricted supply from India leading to mills hiking prices to procure cargoes.
While many are restocking for better prices, some others are very cautious, saying the prices are already very high and huge imports will increase the risk accordingly if the domestic steel prices continues negative trend as exhibited in the penultimate week before New Year.
However this did not dampen the spirits as the traders remained resilient in anticipation of better prices in 2011.T
Incidentally, Chinese iron ore import clocked a resounding growth of 25% in November from October. This sounds paradoxical when the YoY figures saw a drop of 0.9% in January to November 2010.
At the same time changeover to quarterly pricing mechanism has enhanced miners’ leverage over prices. They can control the price trend by reduce supply in short run. It’s learnt that the 3 biggies has asked China’s steel mill to hike the Q1, 2011 contract prices by 7.6%.