Benchmark iron ore futures in China rose more than 3% on Wednesday as trading resumed after the Tomb Sweeping Festival holidays, hitting an eight-month high. The most active iron ore futures for September delivery on the Dalian Commodity Exchange rose 3.3 percent to the highest level since August 5, 2021 at 937 yuan ($147.16) per tonne as demand for steelmakers recovered from the pandemic cuts.
Spot prices of iron ore with 62% iron content for delivery to China were at $159.5 per tonne on April 2nd.
Huatai Futures analysts wrote in a note, "Currently, the sluggish real estate market in China has reduced consumption of steel and iron ore...
According to foreign sources, port iron ore stocks in China totaled 155.6 million tons in the week ended April 1, down 4 million tons from the previous week and down 3.3 percent from the mid-February peak.
Demand for iron ore appears to be increasing, with expectations that China will stabilize its economy and boost its real estate sector, Huatai analysts said.
Other steelmaking materials on the Dalian stock exchange also rose. Coking coal for May delivery rose 0.6% to 3,238 yuan per tonne. Coke prices jumped 2.2% to 4,053 yuan per tonne.
Construction material steel rebar on the Shanghai Futures Exchange for October delivery rose 0.5 percent to yuan 5,136 per tonne.
SinoSteel Futures said in a note, “downward demand for rebar has been delayed due to the pandemic,” adding that consumption will recover with relatively easy credit.
Hot rolled coil futures used in the manufacturing sector rose 0.2% to 5,286 yuan per tonne.
Shanghai stainless steel futures' May contract rose 1.4 percent to 20,530 yuan a tonne. ($1 = 6.3671 Chinese yuan)
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