BEIJING: Singapore iron ore futures fell below the $100-per-metric-ton key psychological level on Friday as some traders liquidated long positions on faltering demand, after most steelmakers in top buyer China completed pre-holiday restocking of feedstocks.
The benchmark February iron ore on the Singapore Exchange was 2.67% lower at $98.2 a ton, as of 0353 GMT, the lowest since Nov. 18.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) ended morning trade 2.37% lower at 762.5 yuan ($104.46) a ton, the lowest since Dec. 30.
Both benchmarks were on track for a third straight weekly fall, shedding 0.3% and 0.7%, respectively, mainly dragged down by seasonally diminishing demand for the key steelmaking ingredient.
Dalian iron ore fell 16% in 2024 and Singapore benchmark dropped 18.5%.
Average daily hot metal output among steelmakers surveyed fell for a seventh straight week, down 1.2% to the lowest since late September at 2.25 million tons, as of Jan 2, data from consultancy Mysteel showed.
“Some bulls closed positions as downside risks mounted with more steel mills recently starting equipment maintenance, which weighed on buying appetite for feedstocks including iron ore,” said Steven Yu, senior analyst at Mysteel.
“Moreover, iron ore shipments have showed signs of picking up.”
The Chinese New Year starts from Jan. 28 and domestic steelmakers usually build up stocks to meet production needs during and after the holidays.
Other steelmaking ingredients on the DCE retreated, with coking coal and coke down 2.34% and 3.16%, respectively.
Steel benchmarks on the Shanghai Futures Exchange weakened.
Rebar lost 1.27%, hot-rolled coil shed 1.32%, and stainless steel dipped 0.63%.
The ferrous market has been weak despite Beijing reiterating support for a subsidy programme for large-scale equipment upgrades for businesses and durable goods trade-in.
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