Dalian iron ore futures prices slid on Wednesday, weighed down by subdued sentiment due to a persistently weak steel market and lack of big-ticket stimulus in top consumer China.

The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) ended morning trade 0.74% lower at 877 yuan ($121.82) a metric ton.

“Traders have shifted their focus back to reality after the important meeting and iron ore prices may feel further pressure from the weak steel market,” analysts at Sinosteel Futures said in a note.

Policymakers in the world’s second-largest economy on Tuesday set key economic targets for the year during the keenly watched annual parliament meeting - the National People’s Congress (NPC).

The main figures were largely in line with market expectations, disappointing those who had been looking for bigger stimulus that will benefit metals consumption.

“The statement around property policy is not new,” analysts at Goldman Sachs said in a note.

“We estimate infrastructure-related on-budget fiscal expenditure may slow to +3.8% yoy in 2024 from +5.1% yoy in 2023, mainly weighed on by slower spending growth on energy saving & environmental protection related projects,” they added in a separate note.

Iron ore rangebound as investors await clear direction

The benchmark April iron ore on the Singapore Exchange was, however, 0.36% higher at $114.85 a ton, as of 0332 GMT.

Other steelmaking ingredients on the DCE were weaker, with coking coal and coke down 2.19% and 1.22%, respectively.

Steel benchmarks on the Shanghai Futures Exchange ticked down amid subdued demand. Rebar fell 0.56%, hot-rolled coil slid 0.57%, wire rod lost 1.22% and stainless steel slipped 0.69%.

“Steel demand recovery has been slow in part because some construction sites in southern China have not yet resumed operations for the moment due to adverse weather,” analysts at Galaxy Futures said in a note.

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