MANILA: Iron ore futures edged lower on Monday after solid gains in the previous week, as negative headlines related to China’s property sector prompted caution.
The steelmaking ingredient’s benchmark October contract on the Singapore Exchange was down 0.8% at $121.95 per metric ton, as of 0440 GMT. It earlier slumped to $119.60, pulling back sharply from Friday’s six-month peak of $123.75.
The most-traded January iron ore on China’s Dalian Commodity Exchange ended morning trade 0.1% lower at 872 yuan ($119.66) per ton. Embattled Chinese property developer Country Garden faces yet another liquidity test with Monday’s deadline to pay $15 million in interest linked to an offshore bond after having dodged default at the last minute twice earlier this month.
Another struggling developer, China Evergrande Group, saw its shares plunge 25% after police detained some staff at its wealth management unit, suggesting a new investigation that could add to its woes.
Chinese state-backed developer Sino-Ocean Group Holding, meanwhile, said on Friday it was halting repayments for all offshore debt until a restructuring was implemented. As the debt crisis besetting Chinese developers deepens, data on Friday showed tumbling investment in the property sector.
“Anything real-estate related remained problematic,” ING economists said in a note, while a survey of Chinese and international investors carried out by JPMorgan showed the worst of China’s property crisis was not yet over.
Shrugging off the weakness in iron ore futures, other steelmaking feeds rose, buoyed by signs of strong demand. Coking coal and coke on the Dalian exchange gained 4% and 2.5%, respectively.
Steel benchmarks in Shanghai were subdued though. Rebar gained 0.4%, while hot-rolled coil was flat and wire rod dipped 0.7%. Stainless steel added 0.1%.
Source: Brecorder
