BEIJING: Iron ore futures drifted in a narrow range on Tuesday, as mixed market signals in top consumer China clouded direction, with more maintenance work dampening demand while low inventory and winter restocking provided a lift.
The most-traded May iron ore on China’s Dalian Commodity Exchange (DCE) was up 0.16% at 925.5 yuan ($129.63) a metric ton, as of 0158 GMT.
The benchmark January iron ore on the Singapore Exchange was down 0.25% at $132.15 a ton. “An increasing number of steel mills have recently implemented maintenance on blast furnaces amid thinning margins, weighing on demand for raw materials as well as their prices,” said Chu Xinli, a Shanghai-based analyst at China Futures. As of Dec 15, blast furnace operating rate among mills surveyed dropped by 3.3% to 78.31% month-on-month, data from consultancy Mysteel showed.
“But the bulk commodity may also be affected by the issue in the Red Sea that have triggered oil prices to jump,” Chu added. Shipping firms have decided to avoid Red Sea as Houthi attacks increase. Other steelmaking ingredients also gained, with coking coal and coke on the DCE up 0.32% and 0.12%, respectively.
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