May 23, 2019 / 2:35 AM / 3 months ago

Dalian iron ore rises amid bourse's call to strengthen risk management

* Dalian Exchange calls for rational trading

* Fundamental situation of iron ore remain bullish- analysts

BEIJING, May 23 (Reuters) - China’s iron ore futures extended gains on Thursday, but the upside was capped as the Dalian Exchange called for a rational trade after hitting a fresh record high in the previous trading session.

The bourse on Wednesday night warned of a complex and variable economic and financial situation at home and abroad and urged members to strengthen risk management.

The most-active iron ore futures on the Dalian Commodity Exchange climbed 0.4% to 725 yuan ($104.90) a tonne as of 0159 GMT. It advanced as much as 4.1% to 733 yuan on Wednesday, the highest level since the contract was launched in 2013.

Fundamental situation of the steel-making raw material remains bullish, which would continue to support the already-elevated prices, said analysts from CITIC Futures in a note.

“With robust demand from steel mills and falling shipment arrivals from overseas miners to Chinese ports in May and June, iron ore inventory will keep decreasing.”

Stocks of imported iron ore at ports have hit the lowest level since October 2017 at 131.7 million tonnes, data compiled by SteelHome consultancy showed.

Benchmark Shanghai rebar edged lower in the morning trade on Thursday, dragging coking coal and coke prices, as mounting tensions between Washington and Beijing dented investors’ confidence.

China’s President Xi Jinping urged the country to prepare for difficult times as the international situation was complex, in the wake of blacklist by the U.S. on Chinese telecom equipment giant Huawei Technologies.

Meanwhile, the U.S. administration is considering Huawei-like sanctions on Chinese video surveillance firm Hikvision, the latest effort by the Trump administration to crack down on Chinese companies.

Construction steel rebar slid 0.5% to 3,885 yuan a tonne.

Dalian coking coal futures fell 2.1% to 1,375 yuan a tonne, while coke futures, which jumped to a 8-month high level, dropped 2.6% to 2,242 yuan.

$1 = 6.9115 Chinese yuan Reporting by Muyu Xu and Shivani Singh; editing by Uttaresh.V

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