Iron ore prices have strengthened in May, supported by renewed buying activity, firm steel production and tighter availability of higher-grade material. By mid-month, benchmark 62% Fe ore delivered to Qingdao had reached $114.7 per tonne CFR, up 3.9% since the start of May.
Restocking by steelmakers, improved mill margins and high pig iron output have helped lift demand for raw materials. Limited availability of premium ore has also added support, even as supply of medium and lower-grade material remains sufficient.
Stronger buying has improved sentiment, but underlying steel demand remains uneven. High supply, weaker export conditions and lower apparent consumption in the first quarter show that the recovery is not yet fully established. Shipments from major producers remain active, and higher port arrivals could improve availability. If supply rises faster than steel demand, prices may face renewed pressure.
Alien Metals Ltd (LON:UFO) is a global minerals exploration and development company that will shortly make the transition to iron ore producer.
