Vale CEO: Iron Ore Price Drop Temporary; Steel Billet Moving Up

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Is the iron ore price drop just temporary? Vale CEO thinks so…

“The fundamentals of the Chinese economy remain solid and the recent drop in iron ore prices is temporary, Murilo Ferreira, chief executive of Vale , the world’s largest iron ore miner, said on Tuesday,” reports Reuters.

“Iron ore prices on the Chinese spot market have fallen 8.2 percent since the beginning of the year to $123.20 a tonne, their lowest level in six months, according to Steel Market Intelligence newsletter.”

“‘There was a recent toughening in credit policy in China and the steel companies were certainly affected,’ Ferreira told reporters after a meeting at Brazil’s Mines and Energy Ministry.”

“‘The companies have ended up working with lower stocks, but that is a transitory position,’ he said.”

In metal price news for steel…

The steel billet cash price closed Tuesday, January 21 at $360.00 per metric ton, halting its three-day flat run on the LME with a 2.9 percent shift. The 3-month price of steel billet continues hovering around $355.00 per metric ton on the LME for the fifth day in a row.

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Chinese steel closed mixed yesterday. The price of iron ore 58% fines from India was range bound. After three straight days of no change, the price of Chinese HRC decreased by 1.1 percent. Chinese slab closed 0.3 percent lower.

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The 3-month price of the US HRC futures contract flattened at $629.00 per short ton after two days of downward movement. The US HRC futures contract spot price was unchanged at $675.00 per short ton.