SINGAPORE: Iron ore futures rose on Friday, posting their largest weekly gain since May 16 on falling iron ore and steel inventories, outweighing Taiwan’s anti-dumping duties.
The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 1.99% higher at 716.5 yuan ($99.95) a metric ton. The contract gained 1.64% this week, snapping two consecutive weeks of losses.
The benchmark July iron ore on the Singapore Exchange was 1.43% higher at $94.65 a ton as of 0801 GMT, rising 1.11% this week, rallying after five consecutive weeks of losses.
“Falling iron ore port inventories are a tailwind, providing downside protection to iron ore prices,” said ANZ analysts.
Total stockpiles of iron ore across ports in China fell 0.74% week-on-week to 133.6 million tons as of June 27, according to SteelHome data.
Mysteel data showed finished steel inventories held by Chinese traders continued to fall from June 20 to 26, marking the seventh consecutive weekly decline.
However, the pace of the fall slowed compared to the week before, which could be attributed to increased production at domestic mills, Mysteel added.
Iron ore dips on increased supply; dollar strength caps gains
Meanwhile, China stocks are set to hit their biggest weekly gain in more than seven months, with the Mideast ceasefire buoying investor sentiment.
Still, China’s industrial profits swung back into sharp decline in May from a year earlier, as sluggish domestic demand from a prolonged property crisis squeezed profits in the country’s industrial firms, compounded by a price war among automakers.
On the trade front, Taiwan is set to impose anti-dumping duties as high as 20.15% on Chinese-made hot-rolled steel starting on July 3.
Other steelmaking ingredients on the DCE rose, with coking coal and coke up 4.89% and 2.52%, respectively.
Steel benchmarks on the Shanghai Futures Exchange mostly gained ground. Rebar and hot-rolled coil strengthened around 1%, wire rod climbed 1.65% and stainless steel fell 0.04%.
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