MANILA: Iron ore futures see-sawed on Friday, but remained on track for steep weekly losses as the demand outlook has darkened in top steel producer China due to a seasonal slowdown in construction activity.
The steelmaking ingredient’s benchmark June contract on Singapore Exchange was up 2.1% at $97.70 a tonne by 0428 GMT. It dropped 1.8% to $94 earlier in the day, hitting its weakest since November, and has fallen around 7% from last week.
The most-traded September iron ore on China’s Dalian Commodity Exchange fell as much as 2.5% to 665.50 yuan ($96.28) a tonne, its weakest since Dec. 2, before wrapping up morning trade up 0.6% at 686.50 yuan.
The typical summer slowdown in construction activity in China beginning June is expected to curb demand for steel. The seasonal downturn follows dismal demand during spring, when it is traditionally at its peak.
China’s disappointing economic backdrop, with the latest data indicating a sputtering post-COVID recovery, also weighed on sentiment.
The country’s steel production control policy is another key drag on prices of iron ore and other steelmaking ingredients. Coking coal and coke on the Dalian exchange fell 2.9% and 3.1%, respectively.
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