Iron ore showed upsides as the interest was buoyed ahead of Chinese holidays

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Increased buying interest by Chinese buyers ahead of weeklong Lunar New Year holidays buoyed the demand for iron ore and other steelmaking commodities. Also, the short rally was supported by strengthening of the Chinese currency (yuan) against the US dollar.

Looking at the last reading of the benchmark iron ore prices, Platts assessed the 62% Fe IODEX & TSI Iron Ore Fines at $78.25/dry mt CFR North China, while TSI 58% Fe Fines, 1.5% Al, CFR Qingdao port was assessed at $64.25/dmt.

Onto the coking coal market, the favourable exchange rates encouraged the procurement of sea-borne coking coal, allowing significant cost savings compared to last month. Platts assessed the CFR China equivalent of Shanxi PLV at $240.29/mt on February 14, putting the domestic-seaborne price arbitrage at $6.79/mt, with the seaborne material being the cheaper one.

In the Atlantic market, S&P Global Platts assessed US high-vol A at $217/mt FOB USEC, based on 32% VM, 1.1% reflectance, with low ash and sulphur and coke strength after reaction typically in the low 60s. US East Coast low-vol HCC was at $198/mt FOB, as more supply moved into blends.

Restocking by the steel mills was witnessed which kept the markets bullish in the midweek, prior to the start of Chinese holidays. However, towards the end of the week market was broadly muted as the major buyers stayed away from the trade.