Seaborne iron ore prices have leapt over the $150/tonne mark for the first time since 1 September 2021. Fundamentals have outweighed concerns of regulatory intervention, wiping out the losses of the previous day.

The Kallanish KORE 62% Fe index jumped on Thursday by $5.10/t to $150.67/dry metric tonne cfr Qingdao. The Kallanish KORE 65% Fe index increased $5.62/t to $179.81/dmt cfr, while the KORE 58% Fe index inched $0.76/t higher to $124.43/dmt cfr.

On the Dalian Commodity Exchange May iron ore settled up CNY 6.5/t at CNY 802.5/t ($126.13/t), while on the Singapore Exchange March 62% Fe futures settled up $7.33/t at $152.94/t. The same contract for 65% Fe and 58% Fe futures settled up $6.96/t at $179.84/t, and up $2.34/t at $127.04/t respectively.

Both scrap and billet prices are also appreciating. 6mm+ heavy scrap delivered to mills in the Yangtze River Delta gained CNY 11/t to CNY 3,652/t. In Tangshan, billet prices were up CNY 20/t to CNY 4,690/t.

Iron ore and steel prices have rapidly brushed aside concerns from the National Development and Reform Commission that prices were increasing too rapidly. The seasonal recovery in steel demand and a recovery in steel output after the Olympics and meetings in Beijing mean iron ore consumption is only expected to increase. By attempting to reassure markets that the real estate sector will not be allowed to collapse, the NDRC itself undermined its attempts to control iron ore prices, by boosting speculation that demand will be strong.

FMG has meanwhile said it plans a 5.4-gigawatt renewable energy power hub in the Pilbara to power its operations and fulfil its net zero targets for 2030. The Uaroo Renewable Energy Hub would include a solar farm and up to 340 wind turbines, as well as a battery storage system. The company expects this to reduce its scope 1 and scope 2 emissions by 1.5 million tonnes/year.