SINGAPORE: Iron ore futures strengthened on Wednesday, underpinned by resilient seasonal demand for the key steelmaking ingredient that countered trade war concerns ahead of looming US tariffs.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) gained 1.15% to 792 yuan ($108.95) a metric ton as of 0257 GMT. The benchmark May iron ore on the Singapore Exchange eased 0.09% to $102.8 a ton.
Steel production is increasing overall, rising higher than last year, said broker Galaxy Futures.
Dalian iron ore at near one-month high on rising China demand
Production at Chinese blast furnace steelmakers rose for the fifth consecutive week on March 27, driven by a further recovery in steel demand from end-users and positive margins for mills, said consultancy Mysteel.
Total iron ore stockpiles across ports in China dipped 0.65% week-on-week to 137.6 million tons as of March 28, Steelhome data showed.
Moreover, China’s factory activity expanded at its fastest pace in four months in March, buoyed by stronger demand and robust export orders, boosting sentiment and leading Chinese stocks to close higher on Tuesday.
US President Donald Trump will impose fresh tariffs on Wednesday, the White House confirmed on Tuesday, but provided no details about the size and scope of the trade barriers.
The announcement is scheduled for 4 p.m. ET (2000 GMT).
On the supply side, the total volume of iron ore dispatched to global destinations from Australia and Brazil rose 5.3% on-week to 26.5 million tons as of March 30, Mysteel said.
Other steelmaking ingredients on the DCE gained ground, with coking coal and coke rising 0.55% and 1.17%, respectively.
Steel benchmarks on the Shanghai Futures Exchange climbed.
Rebar rose 0.7%, hot-rolled coil and wire rod gained about 0.6% each, and stainless steel jumped 0.89%.
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