DCE iron ore futures continued to rise in a day, the main contract closed downward , which resulted in a slightly increase today. The quotation in the morning almost kept stable over yesterday. Some traders tended to increase their quotation during the trading period, while steel mills bought on their demand. PBF at Tangshan port dealt 1040yuan/mt, up 25yuan/mt over yesterday. The IOCJ-PBF price difference has increased to around 400yuan/mt from 50yuan/mt in the same period last year; according to SMM, PBF are favor of steel mills recently due to its cost performance. Some traders tend to buy PBF at ports out of speculation. One steel mill told that although steel profit has maintained a quite high level recently, but the steel price has always ups and downs resulted from the gradually weak downstream industries, thus they cannot buy raw materials in a large amount. They still buy iron ore on a regular basis that buy less but more times. However, with six continuously rising coal price, some steel mills plan to use more middle and high grade iron ore to decrease the coal ratio, which support iron ore price.
Source: Metals Market Index (MMi)