Australian iron ore producer Fortescue Metals narrowed its index-linked price discount for SSF fines cargoes but kept discounts for Fortescue blended fines unchanged.
December-loading SSF fines cargoes will be sold at a 40pc discount to the December 62pc reference index compared with a 42pc discount in November, said Chinese market participants.
A slide in profit margins of steel mills have revived demand for mainstream low-grade fines such as SSF, which are often blended with medium- and high-grade fines such as IOCJ to control costs.
Steel market fundamentals remain robust with a continued increase in China's home prices and revival of infrastructure sector growth, which may see profit margins climb back in the near term.
Mills tend to use more mainstream medium- and high-grade ores to maintain productivity and sufficient profit margin levels.
Fortescue's discount for blended fines for December index-linked cargoes was unchanged at 29pc, while the discount for King's fines was down by 4.5pc to 12.5pc.
