MOC: domestic iron ore prices might go down in June
June 5, 2008
June 5th (Xinhua) – Major fluctuations in commodity prices of iron ore gradually have given way to more stable, but slight gains, according to China’s Ministry of Commerce (MOC).
The average price on the domestic market reached 1,530 yuan (218 U.S. dollars) per tonne by the end of May, up 2 percent from the beginning of the month.
The MOC estimated the price might drop with expanded supply. Domestic rude ore output was up 25 percent in the first four months to 235 million tonnes against the same period last year.
More than 78 million tonnes of iron ore is expected to be added to the international supply in 2008, easing the stressed demand-supply conflict, said analysts.
The huge iron ore stockpiles that filled up Chinese port yards would be reduced as Beijing more than doubled the inventory fee that would be charged for existing stocks in ports.
If the supply kept increasing this way and the freight cost went down, domestic prices for iron ore would go down, said the ministry.