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High Grade Iron Ore to Be Popular on
Rising Coking Coal Prices.
UMETAL
CHINA, With the demand for iron ore
in tightness from2004 to 2008 , Fe
content in imports of this raw
material is dropping , while its
prices are surging for years Before
2007, many Chinese steel mills
bought low grade iron ore because of
cheap prices of coke. As the prices
of coke. As the prices of coking
coal and coke are on the rise, the
economical efficiency in using high
grade ores is increasingly standing
out.
Zeng Jiesheng, a steel analyst,
pointed out that the rise of coking
coal will add more than $100 per ton
to steel producing costs From the
third quarter of 2007 to the middle
of 2008 , china’s domestic coke
prices have rose to an accumulative
RMB1,500 perton ($260 per ton),
which leads to on increase of
$105-130 on steel cost per ton.
Costs of iron ore gain $46-65 per
ton given that it takes 1.55 tons of
iron ore to produce 1 ton of pig
iron. Naturally, the cost hike of
coke this year has overtaken that of
iron ore.
He addeh that a shortage of coking
coal is triggering a change to the
relation of demand and supply for
iron are, which will favor high
grade fines and pellet sourced from
vale, while the low grade kinds such
as Yandi fines, Robe River fines and
Indian fines from Goa will see an
over supply.In the next two to three
years, the world market of coking
coal will still be tight. Its spot
prices are 30 per cent higher than
that of contract, which means that
the prices of hard coking coal may
climb 10 per cent to $330 per ton in
2009, with another 10 per cent in
2010. Umetal reports.
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