China's iron ore futures slumped on Thursday, retreating from its more than five-month high close in the previous session, as supply concerns eased.
Dalian iron ore futures, for expiry in May, plunged as much as 3.1% to 656 yuan ($94.72) per tonne and closed at 657 yuan. On Wednesday, it closed at 680 yuan, the highest since Aug. 2, 2019.
The contract dropped after big miner Rio Tinto allayed fears that a fire at Cape Lambert could disrupt supply.
"A rubber conveyor belt on a shiploader at Cape Lambert caught fire. It is being replaced and we expect the shiploader to be back up in the next 24 hours," a spokesperson from Rio Tinto told Reuters.
Weighing on prices further were shipments of the steelmaking ingredient to China from Australia's Port Hedland terminal - world's biggest iron ore port, which rose more than 12% in December from a month earlier.
The most-actively traded construction steel rebar on the Shanghai Futures Exchange fell 1.3% to 3,555 yuan per tonne. Hot-rolled coil futures, used in cars and home appliances, dropped 1.2% to 3,585 yuan per tonne.
Prices for spot cargoes of iron ore with 62% iron content for delivery to China rose to $96.2 per tonne on Wednesday.
Other steelmaking raw materials were mixed, with Dalian coking coal edging up 0.1% to 1,203 yuan per tonne while Dalian coke slipped 1.4% to 1,880 yuan per tonne.
Shanghai stainless steel futures, with front-month February contract, inched down 0.25% to 14,180 yuan per tonne.
China's Vice Premier Liu He, head of the country's negotiation team in the Sino-US trade talks, will sign a Phase 1 trade deal in Washington next week, the commerce ministry said.
China's consumer inflation steadied while factory-gate prices fell at a slower pace in December, giving Beijing room to stay the course on monetary easing as economic growth cools.
China will for the first time allow foreign companies to explore for and produce oil and gas in the country, opening up the industry to firms other than stat-run energy giants as Beijing looks to boost domestic energy supplies.
China issued import quotas for another 3,180 tonnes of steel scrap, 26,566 tonnes of copper scrap and 7,544 tonnes of aluminium scrap on Wednesday.
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