Fortescue Metals Group Beats Forecasts, Not Selling Iron Ore Stake
Fortescue, the No. 4 iron ore miner globally, seems content with its better cost position and increased output – so much so that the company’s fine with delaying a pending sale.
Via Reuters: “Fortescue put a minority stake in its port and rail business, The Pilbara Infrastructure (TPI), up for sale last December with the aim of raising around $3 billion to pay down debt after a scare last year when iron ore prices sank to a three-year low…The minority stake attracted strong interest, with Fortescue’s advisers Macquarie and Lazard scouring the world for potential bidders, but following an iron ore price recovery, the urgency to sell eased.”
Eased to the point of scrapping a September deadline for it. The iron ore miner has a bright outlook on future prices and demand: the still expect iron ore prices to “average between $110 and $130 a tonne for the foreseeable future, although prices are likely to remain volatile, [CEO Nev] Power said, adding the company remains confident in Chinese demand for seaborne iron ore for the next several decades.”
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Current Global Raw Material and Steel Prices
Chinese steel prices were mixed for the week. The China price of iron ore 58% fines from India remained rangebound. The price of Chinese HRC fell 0.3 percent after rising 1.4 percent the week before. Following a steady week, prices for Chinese coking coal closed flat. The price of Chinese slab increased 1.6 percent this week, closing out the fourth consecutive week of rising prices.
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The steel billet cash price saw the largest upwards shift on the weekly Raw Steels MMI®, rising 3.7 percent on the LME to settle at $140.00 per metric ton. Also on the LME, the 3-month price of steel billet spiked 3.2 percent last week to $160.00 per metric ton.
Following a 0.5 percent increase in the week prior, the price of US shredded scrap fell 3.2 percent last week. The 3-month price of the US HRC futures contract rose 1.1 percent over the past week to $631.00 per short ton. This was the fourth week in a row of increasing prices. This past week, the spot price of the US HRC futures contract kept quiet, holding at at $648.00 per short ton.
Korean steel scrap traded sideways last week. Korean pig iron remained unchanged for the week.
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