The trend of the steel market before the Spring Festival

Steel margins are identified as the key factor for reviving demand for high grade fines. A sustained recovery will have to be observed before a committed increase in purchase volumes for high grade fines can be made.
Carajas fines are mainly used by big state-owned steel mills with large blast furnace capacities, which are currently operating at about Yuan 100/mt ($14.53/mt) steel margins as compared to levels of around Yuan 700-1,000/mt in the middle of the year.
Some China mills expect steel prices to recover after the Chinese New Year holidays in February, when spring construction projects can be started, which will result in a significant increase in demand for higher grade fines.
Earlier in the year, export volumes from Ponta da Madeira totalled 27.1 million mt from January 1 to March 3, rising by 11% to reach a total of 30.1 million mt from March 5 to May 5.
Higher supply of high grade fines is also expected to be available in the market, with the targeted launch of Mt Gibson Iron’s Kooland fines in March 2019. The expected specifications of the new high grade product are 65.5% Fe, 0.9% alumina, 4.5% silica and 0.01% phosphorus.
Production levels are expected to reach a rate of 2.5 million mt a year in mid-2019, with an increase in production rate to 3-4 million mt in 2021.
Source: hellenicshippingnews

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