Iron ore heads for first monthly loss since February

IRON ore is on course for its first monthly decline since February as a brief rally sparked by a fatal coking coal mine explosion in China’s Shanxi province lost momentum, Bloomberg News reported on Friday.The Shanxi accident pushed domestic coking coal futures sharply higher, hitting the daily trading limit on Monday, on concerns that safety-related mine checks could tighten supply, the newswire said. Coking coal prices were at 1,292 yuan ($191) a ton near month-end, up 0.2% from April and extending the previous month’s 12% gain.The higher input costs have squeezed steelmaker profitability. Citing data from consultancy Mysteel, Bloomberg News said blast furnace operating rates were unchanged from the prior week, while Chinese steel mill profitability slipped to 62.3%.“The surge in coking coal prices following the fatal mining accident in Shanxi late last week is adding pressure to steel mill margins, reinforcing the view that iron ore prices should remain capped in the $105-$110 a ton range,” Robert Rennie, head of commodity and carbon research at Westpac Banking Corp told Bloomberg.Rennie added that mills had been lifting purchases of premium lump ore to reduce coke consumption and offset rising input costs, providing some support to higher-grade material.Supply-side pressure has also weighed on sentiment, with Mysteel data showing shipment volumes from Australia and Brazil near a two-year high. Iron ore rose 0.5% to $105.85 a ton in Singapore on Thursday.The Baltic Exchange’s main dry bulk index climbed 3.3% to 3,226 points, its highest level this year, and is up more than 20% in May.The post Iron ore heads for first monthly loss since February appeared first on Miningmx.Weiter zum vollständigen Artikel bei Mining.com Weiter zum vollständigen Artikel bei Mining.com