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Wednesday, July 17, 2019 - 10:30:13 AM
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Mining News Pro - China’s iron ore futures on Tuesday hit their highest level since the index was launched in 2013, as upbeat demand prospects in the world’s biggest producer and consumer of steel added fuel to the raw material’s red-hot rally this year.
According to Mining News Pro - The most-traded September iron ore contract on the Dalian Commodity Exchange surged as much as 4.6% to 924.5 yuan ($134.48) a tonne, before ending 2.4% firmer at 905 yuan.
Dalian iron ore has risen a striking 108% this year, with the earlier gains largely driven by worries about disruptions in supply from top exporters Australia and Brazil.
Monday’s data showing China’s industrial output growth hit a forecast-beating 6.3% in June on an annual basis, supported by a recovery in investments, helped prop-up overall market sentiment, analysts said.
Dalian iron ore has risen 108% this year, with the earlier gains largely driven by worries about disruptions in supply from top exporters Australia and Brazil
“The increase in production especially in commodities has resulted in some increase in inventory. It also reflects producers’ confidence (over demand prospects),” said Helen Lau, metals and mining analyst at Argonaut Securities in Hong Kong.
Solid growth in investment in China’s property and construction sectors in the first half of 2019, along with improving investment in infrastructure, should boost demand for steel commodities, she said.
“We remain positive about iron ore,” said Lau, along with coking coal, another steelmaking ingredient.
Benchmark spot 62% iron ore for delivery to China <SH-CCN-IRNOR62> rose 0.8% to $121.50 a tonne on Monday, edging closer to the five-and-a-half-year high of $126.50 hit on July 3, according to data tracked by SteelHome consultancy.
Fundamentals
* Iron ore’s extended rally comes just days after China’s top steel companies sought government help in keeping the market stable and initiated an investigation whether “non-market factors” had caused the surge in prices.
* The inventory of imported iron ore at China’s ports hovers near the lowest level since early 2017. It dipped to 115.35 million tonnes, as of July 12, from 115.6 million tonnes a week before, data compiled by SteelHome consultancy showed.
* Global miner Rio Tinto reported a 3.5% drop in second-quarter iron ore shipments on Tuesday, as disruptions caused by a cyclone in late March in Australia squeezed output in the April-June period.
* Steel futures rebounded after a four-day decline, with the most-active October construction steel rebar contract on the Shanghai Futures Exchange up 1.8% at 4,037 yuan a tonne. Hot-rolled steel, used in cars and home appliances, climbed 1.5% to 3,898 yuan.
* Coking coal rose 1.5% to 1,420.50 yuan a tonne, while coke gained 1.3% to 2,173.50 yuan.
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https://www.miningnews.ir/En/News/398508
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