SINGAPORE: Iron ore futures prices dipped on Friday amid rising trade war concerns, though were set for weekly gains on strengthening demand for the key steelmaking ingredient in top consumer China.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) traded 0.57% lower at 782.5 yuan ($107.7) a metric ton, as of 0237 GMT.
The contract has gained 2.96% so far this week.
The benchmark April iron ore on the Singapore Exchange was 0.52% lower at $102.95 a ton, gaining 3.14% this week so far.
Hot metal output continued to increase in March by 10,200 tons to 2.3728 million tons month-on-month, and the daily consumption of imported ore logged a monthly increase of 13,200 tons, said broker Everbright Futures in a note.
Hot metal output is typically used to gauge iron ore demand.
There has been a seasonal improvement in downstream demand, said broker Galaxy Futures, adding that there will continue to be demand for replenishment of iron ore in the short term.
Chinese Vice Premier Ding Xuexiang on Thursday pledged stronger policy support for the economy, as Chinese policymakers try to cushion the impact of US President Donald Trump’s tariff salvos.
“Concerns about a protracted trade war appear to have escalated…ahead of April 2 tariff announcements,” said ANZ analysts in a note.
US President Donald Trump on Wednesday unveiled a 25% tariff on imported cars and light trucks starting next week, causing shares in Asian car makers to wipe some $16.5 billion in value.
Dalian iron ore hits 1-1/2 week high on seasonal steel demand
The US plans to impose sweeping reciprocal tariffs on multiple trade partners on April 2.
Other steelmaking ingredients on the DCE faltered, with coking coal and coke down 1.4% and 1.26%, respectively.
Most steel benchmarks on the Shanghai Futures Exchange fell. Rebar shed 0.53%, hot-rolled coil ticked down 0.3%, wire rod eased nearly 0.2%, while stainless steel gained 0.56%.
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