Rising Iron Ore Supply Price Still Dragging Down Steel

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In 2013 iron ore defied the skeptics. Demand in China, the largest importer of the commodity, grew at a stronger pace than almost anyone had expected, helping to support prices, which averaged $135 a ton, the Financial Times reported.

But 2014 is shaping up to be a very different year for the steelmaking ingredient. The benchmark price delivered into China has already fallen by a quarter and recently slipped below $100 a ton for the first time in 20 months.

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On Wednesday, May 28, Chinese HRC jumped up 0.9 percent, landing at CNY 3,380 ($540.78) per metric ton and making it the day’s biggest increase. The price of Chinese coking coal held steady at CNY 1,390 ($222.39) per metric ton. The price of Chinese slab remained essentially flat at CNY 3,480 ($556.78) per metric ton. The price of iron ore 58% fines from India hit a high price of CNY 840.00 ($134.40) and a low price of CNY 830.00 ($132.80) per dry metric ton.

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For the fifth consecutive day, the steel billet cash price held flat on the LME at $390.00 per metric ton. The 3-month price of steel billet saw little movement on the LME at $400.00 per metric ton.

For the fifth day in a row, the US HRC futures contract 3-month price remained essentially flat at $625.00 per short ton. The US HRC futures contract spot price held steady at $685.00 per short ton.

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