SINGAPORE: Iron ore futures edged higher on Friday, helped by rising steel mill production in China, although lingering property sector and steel demand concerns threatened to push prices below the $100 per-metric-ton psychological level.
The most-traded January iron ore on China’s Dalian Commodity Exchange was up 0.1% at 725.0 yuan ($100.29) per metric ton, as of 0330 GMT. On the Singapore Exchange, the benchmark September iron ore was 0.4% higher at $100.7 a metric ton.
“Scant mildly positive headlines have provided temporary relief from the overarching disappointment of a flailing economy. This only creates mouth-watering opportunities for iron ore bears to sell into and soak up additional speculative gains on short positions,” said Atilla Widnell, managing director at Navigate Commodities in Singapore.
“Still, the market looks and feels as though it is psychologically preparing itself to break the US$100/mt support level.” China’s property market woes deepened, while shipments from Australia increased despite the off-peak construction season in the world’s second-largest economy, ANZ analysts said in a note.
Debt-laden developer Country Garden expects to report a net loss for the first half of 2023 and said it would take measures to meet its debt obligations and fix operational issues to get the company back on track.
Meanwhile, inventories of five major carbon steel items held by 184 Chinese steel mills under Mysteel’s regular survey rose further over Aug. 3-9 due to thin demand, with the total volume rising 4% week-on-week to 4.55 million metric tons.
Most steel benchmarks on the Shanghai Futures Exchange fell. The most-active rebar contract dipped 0.9%, hot-rolled coil slid 0.9% and wire rod lost 1%, while stainless steel climbed 1.4%. Other steelmaking ingredients Dalian coking coal and coke declined 1.3% and 2%, respectively.
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