Iron ore prices built on Friday’s gain hitting almost $62 per tonne Monday, a fresh three-month high, after figures released by the Pilbara Ports Authority showed a significant increase of shipments from Australia in July through Port Hedland, the world’s largest iron ore loading terminal.
The import price for 62% iron content fines at the port of Qingdao added nearly a dollar to $61.56 a tonne, data from The Metal Bulletin Index shows, taking the commodity’s monthly average price to $61.28.
Today’s price rally coincides with the release of Port Hedland’s export figures, which rose 9.6% last month to 38.72 million tonnes, compared with 35.3 million tonnes shipped in July last year.
While the numbers were lower than the record high of 41.81 million tonnes reached in June, most of it went to China, which accounted for 32.52 million tonnes of iron ore shipments from the port last month, up from 29.48 million tonnes in the same month last year.
Shipments to South Korea fell 12% year-on-year to 2.54 million tonnes last month, while those to Japan totalled 1.88 million tonnes, marginally lower than the 1.9 million tonnes shipped a year earlier.
Iron ore’s resilience in recent months has defied many analysts’ forecasts, as Beijing’s stimulus plans, restocking by Chinese steel mills and historically low port stockpiles have supported prices.
Major miners had rushed to cut costs in recent years as the steel-making ingredient tumbled into an extended bear market, with low prices that pushed high-cost companies out of the market.
New supply from Roy Hill in Australia, Anglo American’s Minas Rio and Vale’s S11D in Brazil, however, is now expected to outpace demand for some time.