July 9, 2020 / 4:36 AM / a month ago

China iron ore futures rise on steel demand outlook, spot prices hit 11-month peak

* Dalian iron ore up for 5th session

* SGX iron ore slips after 5-day rise

* Shanghai steel futures extend rally

By Enrico Dela Cruz

MANILA, July 9 (Reuters) - Chinese iron ore futures extended gains on Thursday as mills bought the steelmaking ingredient to replenish inventories on hopes of strong demand in the coming months, sending spot prices to an 11-month high.

The Dalian Commodity Exchange’s most-traded September iron ore contract rose as much as 2.5% to 800.50 yuan ($114.56) a tonne in early trade and was headed for a fifth straight session of gains.

Iron ore on the Singapore Exchange, however, slipped 0.5% to $102.20 a tonne after a five-session winning streak.

The spot price of benchmark ore with 62% iron content hit $106 a tonne on Wednesday, the highest since August 2019, based on data from SteelHome consultancy. SH-CCN-IRNOR62

Encouraged by the bullish sentiment towards iron ore and strengthening finished steel prices, iron ore traders kept their price offers firm on Wednesday, according to Mysteel consultancy.

“Strong demand amid optimism over Chinese economic growth recovery continued to feed through the market,” commodity strategists at ANZ wrote in a note.

“Rebounding property sales and stronger heavy machinery sales are reconfirming the underlying demand.”

Citi Research now expects China’s steel demand this year to grow 3.8%, revising its forecast from a 4% contraction.

FUNDAMENTALS

* Steel prices on the Shanghai Futures Exchange rose, with construction material rebar for October delivery up 0.9% by noon break, heading for a sixth consecutive session of gains.

* China’s blue-chip index rose for an eighth straight session in morning trade, gaining 1.1%, while the Shanghai Composite was up 1.03%.

* Hot-rolled steel coil was up 1.1%, while stainless steel edged up 0.1%.

* Coking coal jumped 1.8% and coke climbed 0.6%.

($1 = 6.9875 yuan)

Reporting by Enrico dela Cruz; Editing by Subhranshu Sahu

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below