Iron Ore Prices

Iron ore prices fell in August amid weaker demand. Prices averaged USD 110.1 per metric ton in August, 3.8% lower than July’s price but up 1.6% year on year. On 31 August, the benchmark iron ore 62% Fe import price, including freight and insurance, at the Chinese port of Tianjin was USD 118.0 per metric ton, up 5.8% month on month.

Prices fell sharply in the opening weeks of the month, weighed on by weakness in the Chinese property sector—a key use for iron ore—as well as downbeat Western demand, as signaled by negative PMI readings in the U.S. and the Eurozone. That said, the metal ran counter to the majority of the complex in the second half of August. A crucial factor behind iron ore’s rally was robust demand from Chinese steel mills due to the prospect of production curbs in the coming months, as well as cuts at electric arc furnaces that use scrap—an alternative steel-making process. Moreover, resilient demand from such sectors as infrastructure, power machinery, automobiles and shipping lent some support to prices.