BEIJING: Prices of iron ore futures rose for a third straight session on Thursday, helped by hopes of improving China demand, although rising steel stocks fuelled concerns over the pace of steel production resumption, capping gains.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) ticked up 0.39 percent to 781.5 yuan (USD109.26) a metric ton by 0315 GMT.
The benchmark October iron ore on the Singapore Exchange was up 0.69 percent at USD103.95 a ton, hitting the highest level since August 29. Some steelmakers planned to resume production on Thursday and increase procurement of raw materials, Yingguang Wang, an analyst at consultancy Lange Steel, said in a note a day before.
Steel mills in top Chinese steelmaking hub Tangshan were required to restrict production to ensure better air quality for a military parade in Beijing on September 3 to commemorate the end of World War Two, weakening ore demand temporarily.
Inventories of construction steel have continued to build up, putting pressure on prices, Bright Futures said. Rising steel stocks and lacklustre demand may stop mills from quickly resuming production, which could dent appetite for feedstocks, and thus curb price gains. Keeping price gains in check was expectation of portside stocks piling up, analysts at broker Yongan Futures said.
Coking coal and coke, other steelmaking ingredients, fell 3.09 percent and 2.46 percent, respectively.
Steel benchmarks on the Shanghai Futures Exchange languished. Rebar lost 0.35percent, hot-rolled coil nudged down 0.06 percent, stainless steel ticked 0.39percent lower, while wire rod climbed 0.43percent.
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