CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
US English

Iron ore price rises, gains limited by high inventories

By Fitri Wulandari

08:12, 18 January 2022

A worker watches steel making in a plant
Chinese steel mills are almost finish restocking ahead of the Lunar New Year – Photo: Shutterstock

Iron ore prices rose on Tuesday but it was off its highest in three months pressured by high inventories and as miners in Brazil resumed operations after a week of heavy rainfall. Expected subdued trading ahead of the Lunar New Year added bearish sentiment.

Most active February iron ore contract on the Singapore Exchange gained 1.84% to $126.40 per tonne. The contract hit three-month high on 12 January at $131.2, the highest since October, on supply concern after heavy rains forced iron ore miners in Brazil, including mining giant Vale SA, to temporarily halt operations. 

“As for iron ore, prices declined for a third straight session due to rising port inventories, reduced restocking activity in China and improving weather conditions in Brazil,” ING Group analysts said in a note on Tuesday.

Vale resumes operation

Vale said on Monday that has partially and gradually resumed its operations in Minas Gerais after heavy rainfall that affected the region last week. Because of the stoppages in Minas Gerais, Vale estimated that the heavy rainfall affected 1.5 million tonnes of iron ore production and third-party purchase.

“Vale considers the seasonal impact of the rainy season in all operations, and therefore reiterates its iron ore production guidance of 320-335 million tonnes for 2022,” the company said.


2,070.23 Price
-0.130% 1D Chg, %
Long position overnight fee -0.0193%
Short position overnight fee 0.0111%
Overnight fee time 22:00 (UTC)
Spread 0.50

Natural Gas

2.73 Price
-2.130% 1D Chg, %
Long position overnight fee 0.0458%
Short position overnight fee -0.0677%
Overnight fee time 22:00 (UTC)
Spread 0.0050

Oil - Brent

78.33 Price
-1.360% 1D Chg, %
Long position overnight fee 0.0011%
Short position overnight fee -0.0230%
Overnight fee time 22:00 (UTC)
Spread 0.045

Oil - Crude

73.64 Price
-1.490% 1D Chg, %
Long position overnight fee -0.0137%
Short position overnight fee -0.0082%
Overnight fee time 22:00 (UTC)
Spread 0.040

In China, steel mills are gradually completing replenishment as the Lunar New Year holiday is approaching.

Inventories up

“Steel mills tend to wait-and-see and purchasing enthusiasm is not high,” Shanghai Metal Market (SMM) said in its daily iron ore note on Monday.

Iron ore inventories at ports in China rose 0.55% to 152.64 million tonnes in the week ending 14 January, according to SMM data. Steel inventories rose 1.94% to 9.94 million tonnes in the same period.

Iron ore prices on the Dalian Commodity Exchange dropped 2.35% to RMB705 ($111.02)/tonne on Monday.

Read more: Iron ore gives up gains on China’s steel demand outlook

Related topics

Rate this article

The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
Capital Com is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as an investment advice. Any opinion that may be provided on this page does not constitute a recommendation by Capital Com or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risk.

Still looking for a broker you can trust?

Join the 570.000+ traders worldwide that chose to trade with

1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading