SINGAPORE: Dalian iron ore futures were set for their first weekly loss in seven as China’s government continued to intervene in the market to regulate prices, although the contract gained on Friday due to positive factory data and optimism over the property sector.
The most-traded January iron ore on China’s Dalian Commodity Exchange was up 1.1% at 966 yuan ($135.37) per metric ton, as of 0320 GMT. For the week so far, Dalian iron ore prices lost 1.1%.
On the Singapore Exchange, the benchmark January iron ore traded flat at $129.6 a metric ton.
Caution heightened after the world’s top consumer issued warnings on enhancing supervision on the market to curb a price rally. China’s Dalian Commodity Exchange said on Thursday it will continue to strengthen its supervision of iron ore futures, and resolutely maintain the safe and stable operation of the market.
The Price Monitoring Centre of China’s Development and Reform Commission have increased oversight to control soaring prices, which analysts refer to as “frequent and forceful interventions”.
Despite the initial success in price management, prices are currently staging a rebound. Lifting sentiment, China’s factory activity unexpectedly expanded in November, driven by rising orders, a private survey showed on Friday. Although sluggish external demand continues to weigh on manufacturers.
The optimism on iron ore could expand if Beijing rolls out more structural reforms. China’s demand for steel in electric vehicles and green infrastructure has already kept average prices high despite the property slump. Steel benchmarks on the Shanghai Futures Exchange were mixed.
The most-active rebar contract strengthened 0.3%, hot-rolled coil grew 0.4%, and wire rod increased 0.6%. Meanwhile, stainless steel lost 2.4%.
Comments
Comments are closed for this article.