Monday, September 11, 2023

Iron ore prices increase due to better China data and strong demand


BEIJING: On Monday, iron ore futures prices increased as improved economic data from the world's second-largest economy tempered a risk-averse sentiment stoked by Beijing's most recent market oversight move.

The most-exchanged January iron mineral on China's Dalian Ware Trade (DCE) exchanged 1.86% higher at 847 yuan ($115.68) a metric ton, starting around 0232 GMT.

The benchmark October iron mineral on the Singapore Trade was 2.18% higher at $115.8 a metric ton, starting around 0236 GMT.

On Saturday, official data revealed that factory-gate price declines slowed and consumer prices in China returned to positive territory in August, signaling a stabilization in the economy and lessening deflationary pressures.

The persistently high daily output of hot metals indicates that steady demand was the driving force behind iron ore prices. Analysts at Huatai Futures wrote in a note that "the blast furnace operating rate among mills continued to move up while a turnaround (of reduction) in daily hot metal output is not yet seen."

The everyday hot metal result among plants studied moved by 0.53% on the week to 2.48 million tons in the week as of Sept. 8, the most noteworthy since October 2020, information from consultancy Mysteel showed.

Coking coal and coke on the DCE increased by 2.18 percent and 0.85 percent, respectively, in addition to other ingredients used in steelmaking.

Due to rising production costs, some Chinese coking plants have proposed raising their coke offer prices by 100 to 110 yuan per ton starting on Monday. This round of conflict between steel mills and producers of coke is expected to end in failure, according to some analysts.

"We ought to likewise be cautious about any drawback gambles (for unrefined components) as long as the steel market stays feeble," said Cheng Peng, a Beijing-based examiner at Sinosteel Prospects.

Steel benchmarks on the Shanghai Fates Trade mellowed as request stayed languid, in spite of entering top development season.

Rebar lost 0.27 percent, hot-rolled coil lost 0.21 percent, wire rod lost 3.09 percent, and stainless steel lost 0.35%.

($1 = 7.3222 Chinese yuan)

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