Metals: ARGUS iron ore price assessments

Metals: ARGUS iron ore price assessments

The ARGUS iron ore price assessments

Market forces have driven wider spreads and lower correlation between prices for different grades of iron ore, against a background of tighter environmental policies and ongoing trade disputes. This has increased demand for greater price transparency in the iron ore market. To meet this demand, leading international price reporting agency (PRA) Argus offers a comprehensive suite of iron ore assessments across fines and lump, seaborne and portside prices.

International iron ore specifications

58% Fe fines, cfr Qingdao 62% Fe fines, cfr Qingdao (ICX™) 62% Fe fines, cfr Qingdao (ICX™-LPHS) 65% Fe fines, cfr Qingdao 62% Fe lump, cfr Qingdao 62% PCX seaborne equivalent
Fe content (%) 58 62 62 65 63 62
Gangue elements
SiO2 (%) 6.0 3.75 5 3.5 3.5 3.75
Al2O3 (%) 2.75 2.25 2.25 1.9 1.5 2.25
Impurities
Phosphorus (%) 0.09 0.1 0.06 0.06 0.08 0.1
Sulphur (%) 0.05 0.02 0.02 0.02 0.02 0.02
Physical parameters
Moisture (%) 10 8 8 8 4 8
Grain size 10% >6.3mm and 12% <0.15mm 10% >6.3mm and 15% <0.15mm 10% >6.3mm and 15% <0.15mm 16% >6.3mm and 20% <0.15mm max 15pc <6.3mm
max 25pc >31.5mm
10% >6.3mm and 15% <0.15mm
Parcel (minimum) 40,000t 40,000t 40,000t 40,000t 40,000t na
Delivery period 2-8 weeks 2-8 weeks 2-8 weeks 2-8 weeks 2-8 weeks na
Assessment frequency weekly daily daily daily daily daily

Domestic Chinese portside specifications

62% Fe fines, fot Qingdao port (PCX) PBF fines, fot Qingdao port BRBF fines, fot Qingdao port NHGF fines, fot Qingdao port SSF fines, fot Qingdao port PBF fines, fot Caofeidian port SSF fines, fot Caofeidian port
Fe content (%) 62 typical typical typical typical typical typical
Gangue elements
SiO2 (%) 3.75 typical typical typical typical typical typical
Al2O3 (%) 2.25 typical typical typical typical typical typical
Impurities
Phosphorus (%) 0.1 typical typical typical typical typical typical
Sulphur (%) 0.02 typical typical typical typical typical typical
Physical parameters
Moisture (%) 8 typical typical typical typical typical typical

Argus’ reliable and robust price assessments are coupled with industry-leading news, monthly and quarterly market analysis and a unique monthly index data audit. A downloadable Excel database of iron ore spot deals, bids and offers — which includes all the key information around grades, price, loading windows and volume in an easy-to-use format — further supplements the Argus iron ore offering.

Prices and news are delivered daily online via the Argus Metals platform and through the flagship Argus Ferrous Markets report, which offers a holistic view of global ferrous markets. For the Asia-based market observer the Ferrous Midday intra-day update and the Ferrous Bulletin end-of-day Asia market wrap, which includes a detailed rationale and breakdown of the day’s iron ore price, add further granularity, particularly around the iron ore market.


Advantages of the ARGUS iron ore price assessments

Argus compiles iron ore assessments using volume-weighted averages of spot market activity across the entire day. The most liquid seaborne index is the ICX®, the price for 62pc Fe iron ore fines cfr Qingdao. Through quality and timing normalisation, as well as the use of financial forward curves to integrate floating price deals, Argus pulls in the broadest possible data for each day’s index. The data are weighted according to quality in line with the IOSCO data hierarchy, which places the greatest emphasis on concluded transactions, ensuring that this methodology is ideally suited to serve the modern iron ore marketplace.

Argus has monitored Chinese port stock prices longer than any international price reporting agency, with its PCX™, the price for 62pc Fe fines fot Qingdao port, reflecting the average value of stocks at Qingdao port going back to 2013. Argus has a unique approach to illiquid seaborne spot markets, such as those for lower-grade ores of 56.7pc Fe, which converts prices in Chinese yuan/wet tonne to a seaborne equivalent price in US dollars/dry tonne.

To provide full transparency behind how the ICX is calculated, Argus publishes a rationale explaining the day’s activity, which is supplemented by further information in the daily Ferrous Bulletin. An audit of all the data recorded by Argus is provided to subscribers at the end of each month. Argus makes the raw spot price data — brands, prices, volumes — on which it calculates the assessment available for download to provide absolute confidence in the published assessments.


Users of the ARGUS iron ore price assessments

Some of the world’s largest iron ore mining companies and trading firms reference the ICX in supply contracts. A number of electronic trading screens, including the widely used globalORE and Corex platforms, provide the ICX as an option for use in index-linked spot transactions.

Further downstream, Argus’ indicative steelmaking costs and mill margins, which include the iron ore price assessments, provide manufacturers that source material from a steel mill with a view of steelmaking raw material costs and potential margins.


Iron ore steel smelting

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