Iron ore futures prices rebounded, supported by improving steel output in China, while gains in steel benchmarks reflected improving sentiment despite weak housing data.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) traded 0.82% higher at 803.5 yuan ($112.94) a metric ton.
The benchmark September iron ore on the Singapore Exchange was 0.24% higher at $105.75 a ton, as of 0730 GMT.
In early September, key steel enterprises produced an average daily output of 2.087 million tons, a month-on-month increase of 7.2%, according to Chinese broker Galaxy Futures.
This comes after China’s crude steel output in August slid for a third consecutive month as steelmakers in Tangshan, China’s top steelmaking hub, curbed operations for a major military parade in Beijing. Meanwhile raw steel output in Brazil fell 4.6% year-on-year in August.
After weeks of declines, production of iron ore concentrates by Chinese mining companies rebounded last week, a sign that domestic miners are gradually rebooting operations, said Chinese consultancy Mysteel.
Meanwhile, China’s new home prices fell 0.3% in August month-on-month, as weakness in the property sector persisted.
Elsewhere, the state-backed China Iron and Steel Association will hold a meeting with the heads of iron ore procurement at steelmakers.
Other steelmaking ingredients on the DCE strengthened, with coking coal and coke up 5.84% and 4.24%, respectively.
China’s monthly coal output fell 3% year-on-year in August, down to its lowest in over a year as curbs on production continued to weigh.
Steel benchmarks on the Shanghai Futures Exchange mostly gained ground. Rebar and hot-rolled coil rose 1.25%, and wire rod (SWRcv1) increased 0.09%, while stainless steel dipped 0.27%.
Source: Reuters
