International iron ore prices recently fell sharply, the current import iron ore prices from the February high of 158 US dollars / ton down to 123 US dollars / ton in the vicinity, close to last year's low. Ore prices continued to "dive" once again affect the market sensitive nerves, steel traders are frequent panic of Paohuo.

In this case,

    Monitoring data show that as of May 17, the domestic main port iron ore stocks of 69.62 million tons, is the eighth consecutive week of growth. Jiangyin Hong Kong trader Zhang Ping told the Futures Daily reporter that the port has a backlog of more than 20 million tons of iron ore.

 

According to the data released by the Association, by 2020 China's iron ore production capacity will be more than 430 million tons, the new capacity will be fully put into production, is expected to output 300 million tons. Many foreign institutions also issued a warning this year, said that by 2015, the three major miners (Brazil CVRD, Australia Rio Tinto, BHP Billiton) new iron ore production capacity is expected to reach 600 million tons.

 

"Whether domestic or international, iron ore over the future supply of a surplus is a foregone conclusion." Analyst He Hangsheng that the supply of iron ore showing an increasing trend year after year, making the market fears become increasingly strong, ore prices are still down market outlook.

 

Ore prices fell to panic in the market focused on the outbreak of the steel market downturn Gengrang industry chain crisis-ridden, the market is now pouring goods tide.

 

"In order to sell, we can only reluctantly flesh." Zhang Ping told reporters that traders are now anxious to mine shipments, the phenomenon of selling prices is very common. On the other hand, the profit margins of steel mills have also doubled the pressure on mining traders, they have to accept more price challenges and exposure risks, as soon as possible to effectively inventory is a priority.

 

It is understood that the past two weeks, the domestic steel prices have begun to be part of the iron ore cargo back to the market to sell in order to reduce inventory to reduce costs. A large domestic steel prices of a sales staff also confirmed that the phenomenon of the sale of raw materials steel does exist, but more than non-pure selling, but to take a package of plans to sell by far to reduce the risk of falling ore prices.

 

"Compared with the previous month, compared to the current volume of orders, very little, basically in a week or so." The sales staff said that taking into account the difficulties of steel to the inventory, in order to reduce the loss of steel mills in the iron ore market Selling raw materials, the greatest possible hedge.

 

"Iron ore prices, will undoubtedly bring further down the cost of steel-making." Guotai Junan Futures analyst Fu Yang said that in the first quarter due to falling ore prices lag, steel prices continued to decline in profitability, loss of surface increases, once the mine Prices fell accelerated, the profitability of steel mills will be improved, but it will make the whole industry production cuts are even weaker, then the downward trend in steel prices is more difficult to reverse.

 

Spread in the panic, 21, with a steel weather vane known as the Shagang once again lowered the ex-factory price. "Steel City 'air' filled the air, the short term whether to start production to see whether the loss of steel prices will continue to increase at a loss to a certain extent, the market forcing the industry will intensify efforts to cut production." Fuyang said.