Iron ore spot markets continued to climb on Friday, led once again by lower grades. According to Metal Bulletin, the price for benchmark 62% fines rose by a further 0.2% to $85.53 a tonne, extending its rally over the week to 14.5%. It now sits at the highest level since late March 2017 having rallied 33.1% since late November. Continuing the theme seen earlier in the week, lower grade ores were the standout performer on Friday. 58% fines jumped by another 5.1% to $63.74 a tonne, leaving the price at two-year highs. For the week, it added 19.5%, extending the move from November 26 last year to 60.5%. With prices for lower grades rallying harder than the benchmark, the price discount between 58% and 62% fines narrowed to lowest level since December 2016. After settling at 17-month highs on Thursday, the price for 65% fines eased a touch on Friday, falling 0.1% to $100.80 a tonne. For the week, it rose 13.1%. The latest price moves followed reports of delays in offloading iron ore imports at Chinese ports, amplifying already heightened concerns about supply disruptions to seaborne markets following a mine disaster in Brazil in late January. According to Reuters, citing shipping data from Refinitiv, dozens of ships carrying coal and iron ore to China are stuck outside ports waiting to unload with traders saying harbour authorities are taking longer than usual to clear the imports with customs officials. “While some congestion is normal, especially as China heads into a market shutdown for its week-long Lunar New Year holiday, a ship broker and bulk trader said the backlog had swollen significantly over the past week as dozens of new ships arrived while far fewer cleared customs,” Reuters said. The ports most affected by the slowdown are Dalian, Huanghua, Jingtang, Lanshan, the Ningbo and Zhoushan zone, Qingdao, Qinhuangdao, Shantou, and Yingkou, according to the Refinitiv data. The reports coincided with further strong gains in Chinese bulk commodity futures on Friday. The most actively traded iron ore contract in Dalian finished trade at 621.5 yuan, up substantially from 598 yuan on Thursday evening. That gain was mirrored by coking coal and coke futures which finished at 1,290 and 2,112.5 yuan respectively, up from Thursday’s night session close of 1,268 and 2,069.5 yuan. Steel futures traded separately in Shanghai may have also been a factor behind the strength in bulk commodity contracts with rebar and hot-rolled coil ending trade at 3,754 and 3,648 yuan respectively, up from the prior close of 3,724 and 3,622 yuan. With Chinese markets now closed until next week for Lunar New Year holidays, activity in spot markets will likely slow to a crawl in the coming days. Here at Business Insider, the rule of thumb during this period will be that if spot markets move, we’ll report on it. If they don’t, we won’t. Site highlights each day to your inbox. Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.
Lower-grade iron ore spot prices reached a two-year high as 58% fines leapt 5.1% to $63.74 per metric tonne (mt), while the spread between 58% and 62% fines narrowed to its least since December 2016. The figures come as exporters face bottlenecks at Qingdao's ports, including Dalian, China and Yingkou, according to data from Refinitiv. Traders blamed harbour authorities for "taking longer than usual" to clear the imports, with the week-long Lunar New Year holiday set to lengthen delays.