Scrap-iron ore spread at two-year low on iron ore rally

摘要

The outright ratio between steel scrap and iron ore dropped to its lowest level in over two years on the back of a rally in iron ore prices and little support for steel scrap. On Friday, the ratio between the two steelmaking raw materials stood at 3.18: 1 (or 2.16:1 when accounting for equivalent iron units), compared to its all-time highs in March 2018 at around 5.85:1. While 62% Fe IODEX CFR China prices rallied to their highest level since August 2014 amid tightening supply after Cyclone Veronica hit Western Australia, and recovery in China steelmaking margins, prices for Turkish import heavy melting scrap 1:2 (80:20)—Turkey is the largest seaborne buyer—remained subdued on sluggish steel product market sales in the country.