16.3 C
New York
Wednesday, September 28, 2022

Iron ore futures rise as China restocking demand lifts spot prices

MANILA: Dalian and Singapore iron ore futures advanced on Thursday, as restocking demand underpinned spot prices in top steel producer China, although doubts about the sustainability of a recovery in demand capped gains.

The most-traded iron ore, for delivery in January next year, on China’s Dalian Commodity Exchange ended morning trade 1.8% higher at 737.50 yuan ($109.44) a tonne, up for a second straight session. On the Singapore Exchange, the front-month September contract rose 2.2% to $112.30 a tonne.

Benchmark 62%-grade iron ore’s spot price for the China-bound material settled at $111 a tonne on Wednesday, up 11% from the year’s low at $100 last touched on July 21, according to data from consultancy and industry news provider SteelHome.

“The production of molten iron broke the downward trend, (rising) for six consecutive weeks,” analysts at Sinosteel Futures said in a note. Steel mills have restarted some of their idled blast furnaces in recent days, encouraged by improved margins and a pickup in demand from the construction sector.

But the medium-term demand outlook for steel products and ingredients remains clouded by several issues, such as mandatory steel output cuts in China aimed at curbing emissions, a financial crisis engulfing Chinese property developers and COVID-19 lockdowns.

“It is still doubtful whether the (downstream) demand for finished products can sustain production resumption,” Sinosteel analysts said. Construction steel rebar on the Shanghai Futures Exchange slipped 0.1%, while hot-rolled coil gained 0.1%. Stainless steel rose 0.9%. Other steel inputs traded lower, with Dalian coking coal down 0.9% and coke dropping 1.4%.

Dalian coke had climbed to a near five-week high on Tuesday, also propped up by increased downstream demand. Analysts said rebounding prices of raw materials could restrain Chinese steelmakers from ramping up output.

Iron ore futures rise as China restocking demand lifts spot prices

Source: Brecorder

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Stay Connected

11,297FansLike
12,893FollowersFollow
747FollowersFollow
- Advertisement -

Latest Articles

Popular Articles