BEIJING: Iron ore futures are set for a weekly fall amid a flurry of profit-taking, ahead of top consumer China’s third plenum, although growing expectations of US rate cuts pushed up prices on Friday.
The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 0.3% higher at 827 yuan ($113.84) a metric ton.
It is down 3.2% week-on-week. The benchmark August iron ore on the Singapore Exchange was 0.5% higher at $107.8 a ton, as of 0713 GMT, a drop of more than 2% from the closing price last Friday. The prospect of easing monetary policy helped boost sentiment across the commodity complex, ANZ bank analysts said in a note.
“This week, the focus of (iron ore) trading shifted back to fundamentals,” said a Shanghai-based trader, requesting anonymity as he is not authorised to speak to media.
Iron ore prices are expected to remain under pressure from dwindling demand in the short term after hot metal output eyed a more obvious fall this week and losses among steelmakers exacerbated, analysts at Everbright Futures said in a note.
The average daily hot metal output among steelmakers surveyed declined for a third week by 0.4% from the prior week to around 2.38 million tons as of July 11, data from consultancy Mysteel showed. Meanwhile, investors and traders are awaiting possible stimulus from China’s Communist Party leadership meeting, which is scheduled for July 15-18 and will outline efforts to promote advanced manufacturing, revise the tax system to curb debt risks, manage a vast property crisis and revitalise the private sector, according to policy advisers.
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