China's tax increases on the iron and steel sector increased selling pressure on iron ore futures, causing prices to end a four-day upward streak. However, the decrease in port stocks in the country limited the losses in prices.
The most actively traded May iron ore futures contract on the Dalian Commodity Exchange (DCE) decreased by 0.89% to trade at 831.5 yuan (USD 114.87) per metric ton as of 02:50 Türkiye time. On the Singapore Exchange, the March futures contract decreased by 0.22% to 108.25 USD.
Iron ore stocks at Chinese ports decreased by 1.15% to 145.8 million metric tons as of 21 February. This was one of the factors limiting the sharp decline in the market. On the other hand, new tariffs imposed on Chinese steel by the US and Vietnam increased uncertainties in global markets. While the US imposed a 25 % tariff on steel products from China, this rate increased to 27.83 % in Vietnam.
Other raw materials used in steel production also lost value. In the DCE, coking coal decreased by 1.77% and coke by 2.46%. On the Shanghai Futures Exchange, rebar decreased by 0.8%, hot rolled coil by 1.3% and stainless steel by 0.49%, while only wire rod gained 0.76%.
The ongoing uncertainties regarding steel production in China continue to determine the direction of the markets. Planned blast furnace maintenance and changes in raw material stocks will continue to have an impact on iron ore prices.
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