The Price Trend Of Iron Ore In The Mining Area Of The Vale Mining Area Is Suspense.

Beijing time 18 morning, the Brazil mining giant vale announced that after the new crown was banned from the operation of the itbila comprehensive mining area (including Concei o, Cau and Periquito three mining areas), the local regulatory authorities to lift the ban.

As soon as the news came out, domestic iron ore should fall. The main contract for iron ore futures jumped 2%, followed by a narrowing or even a rise of 765 yuan / ton, or 1.03%.

In an interview with our reporter, Vale said that the output of the mine was still less than 1 million tons due to the suspension effect, and after the lifting of the ban, the output of the mine will be completely restored in a very short time. The company's iron ore directive in 2020 is still 3.1 million tons to 330 million tons.

"Although the mining area is now resuming production, it is hard to say whether the follow-up will be repeated or not. The market needs to make preparations for the mine's output to change at any time." An iron and steel industry told reporters that "the key to the success of the Vale's production is the production of its northern system."

But he told reporters that according to the transport volume of the first five months of the vale, to achieve this goal this year, we must maintain the shipment volume of more than 80 million tons per quarter in the third to the fourth quarter. The task is quite arduous.

Iron ore prices rise

In the first 4 months of this year, under the influence of the new crown epidemic, iron ore prices generally showed a trend of oscillation. But since May, China's iron ore demand has continued to recover, and the major overseas steel producing countries have also entered the stage of resumption of production, and iron ore prices have continued to rise to a new high this year.

At the end of 5, Prof's 62% grade iron ore price index and Shanghai iron and steel iron ore spot price (62%, Qingdao port, CFR) were 100.9 US dollars / ton and 101.05 US dollars / ton respectively, up 20.2% and 20.7% respectively compared with the beginning of May. The main contract price of iron ore futures of DCE is 752 yuan / ton, which is 23.2% higher than that of early May.

In June 6th, the Brazil River Valley, which broke out last year, was found to have been infected with the new crown virus by 188 workers in the etapira complex. Last year, the mining area was ordered to be suspended by local regulators. If vale violates the stop production regulations, it will be punished by a daily fine of 50 000 rial.

The itreila mining area produced 36 million tons in 2019, accounting for 12% of the total mine output in 2019. In the first quarter of 2020, the output of mining area was 6 million 7 thousand tons, and the same quarter fell 35.4%.

As the southern hemisphere enters winter, the Latin American region has become the "new epicenter" of the world's new crown disease. According to the WHO report, 34918 new cases were diagnosed in Brazil in June 16th, with a cumulative diagnosis of over 920 thousand. It has become the second country with more than 900 thousand confirmed population after the United States.

The spread of the epidemic intensified the market's concern about the shortage of iron ore supply. After the announcement of the mining area's closure in the vale, the iron ore futures contract once reached a high level of 798 yuan / ton on 8 days, and the iron ore futures of the Singapore Exchange rose to 103 U.S. dollars / ton, the highest point in 9 months.

"The price of iron ore has receded in recent years, but fell on the 18 day, but it does not mean that it has entered a downward channel." These people told reporters. According to the latest issue (June 11th) data, China's port iron ore inventory is only 98 million 770 thousand tons, down by 15% over the beginning of March, a low point in nearly four years.

"In fact, the iron ore sent to China from Australia and Brazil last week has been reduced, supporting the current ore price." Jin Lian created iron ore analyst Xu Cuiyun told our reporter, "after entering the summer, the downstream demand is likely to slow down, followed by iron ore is likely to show a strong first and then weak trend."

China's demand is still high.

In June 15th, the National Bureau of Statistics announced that the average daily output of crude steel in China in May was 2 million 976 thousand tons, a record high, and the last new high occurred in June 2019. The crude steel output was 2 million 918 thousand tons in the same month.

In the same period, China's pig iron production was 77 million 320 thousand tons, an increase of 2.4% over the same period, and 1-5 tons of pig iron output of 355 million 990 thousand tons, an increase of 1.5% over the same period, and 2 million 577 thousand tons of daily pig iron production, an increase of 10% over the same period last year. The output of pig iron has reached a new high, with 1 tons of hot metal requiring 1.6 tons of iron ore, and iron ore demand of 1.24 million tons.

"For the current domestic iron ore futures, the recovery of the ETA Bela comprehensive mining area is not very important. The above iron and steel industry told reporters, "more critical data is the domestic operating rate, inventory and other indicators, if domestic demand has been strong, iron ore still has room for growth."

According to the data of radish investment, the operating rate of blast furnaces in China's small and medium-sized steel enterprises has been rising since March, and has risen to 87.4% as of June 12th, reaching a new high for two years. From the comprehensive view of all steel enterprises in the whole country, the operation rate of blast furnace has reached the same level in 2019.

Follow up, although China's construction industry will enter the seasonal consumption off-season, but industrial consumption is still recovering, the concept of "new capital construction" makes the market demand for iron ore in China stable. From overseas market, with Japan announcing the lifting of the national emergency and the UK's resumed road map, the main iron and steel production areas resumed production and resumed production, and the demand for iron ore will gradually increase.

At the same time, some market organizations believe that the iron ore price level during the 1-3 month of the most serious epidemic situation this year is likely to be the "bottom of the price" for a period of time. Under the premise that the supply of Brazil market is difficult to increase significantly and the relationship between our country and Australia is uncertain, the iron ore port inventory is difficult to fundamentally reverse, and the price is also difficult to fall back completely.

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