SHANGHAI, Jun 7 (SMM) –In early May, end-use demand had shifted from peak season to off-season, and steel production was high, leading to severe finished product inventory backlogs and losses at some steel mills in south-west, north-west and north China, forcing some to cut production. The output of pig iron dropped significantly in May. As a result, iron ore prices fell sharply month-on-month. Lump and pellet premiums fell accordingly. However, continuously falling coke prices and lower port inventory allowed lump premiums to rebound afterwards. Most steel mills struggled to break even in the off-season, which softened their demand for high-grade iron ore, such as lumps and pellets. As such, the increase in premiums of pellets and lumps was limited.
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