BEIJING: Benchmark iron ore futures in China extended losses into the second straight session on rising shipments from miners, though supply uncertainties still overhang due to the coronavirus pandemic.
Iron ore shipments from Australia and Brazil rose by 5.0 million tonnes to 29.3 million tonnes last week, data compiled by Mysteel consultancy showed.
The most-traded September contract of iron ore futures on the Dalian Commodity Exchange ended down 1.4% to 760 yuan ($107.47) a tonne on Wednesday. But Huatai Futures said that recent rising shipments do not suggest a turning point in the supply side.
"Weekly shipments (of iron ore) are still fluctuating, and the intensifying pandemic in Brazil has been the focus of the market," Huatai Futures said in a note. Brazil has so far recorded 739,503 confirmed coronavirus cases and a death toll of 38,406, the third highest worldwide.
Spot prices for iron ore with 62% iron content for delivery to China fell to $105 a tonne on Tuesday. Construction steel rebar on the Shanghai Futures Exchange, for October delivery, closed down 0.4% to 3,587 yuan a tonne.
Hot-rolled coil futures fell 0.4% to 3,516 yuan per tonne. Other steelmaking ingredients were mixed, with Dalian coking coal dropping 0.3% to 1,186 yuan a tonne while coke rose 0.9% to 1,962 yuan per tonne.
Shanghai stainless steel futures, for August delivery, dropped 0.6% to 12,910 yuan a tonne. China's May factory gate prices fell by the sharpest rate in more than four years, underscoring pressures on the manufacturing sector as the COVID-19 pandemic reduces trade flows and global demand.
China's coal mining hub Shanxi will shut down all small-sized coal mines, with annual capacity below 600,000 tonnes, in the province by the end of 2020.
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