Dalian and Singapore iron ore futures decreased on Monday after China's state planner said they would focus on efforts to regulate prices of the steelmaking component and reduce price speculation that really deviates.
The National Development and Reform Commission said on Friday that it was greatly concerned about fluctuations in iron ore prices after the recent sharp increase.
The first week of 2023 also saw increased market voltality, with concerns about the COVID-19 outbreaks in China and the seasonally decreasing domestic steel demand.
On the Singapore Exchange, the February iron ore contract SZZFG3 was trading down 1.3% at $116.25 per tonne as of 0734 GMT.
”The reason why this is frustrating for the government is understandable, given that costs have been increased for real estate developers, and iron ore futures are 'out of physical supply and demand'," said Atilla Widnell, Managing Director of Navigate Commodities.
However, steel benchmarks and other Dalian steelmaking inputs increased, and coking coal DJMCV1 and coke DCJcv1 increased by 3.1% and 3.5%, respectively.
Rebar on the Shanghai Futures Exchange Srbcv1 increased by 0.6%, hot-rolled coil SHHCCV1 by 0.3%, wire rod SWRCV1 by 0.1% and stainless steel SHSScv1 by 2.5%.
Widnell also said steelmakers should soon start ramping up production to meet inventory needs before, during and after Chinese New Year in late January.
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