SHANGHAI: Iron ore prices rose for a second session on Thursday, as Chinese steelmakers stepped up seaborne purchases ahead of a national holiday, although shrinking steel mill margins clouded the demand outlook.
The most-traded iron ore contract on China’s Dalian Commodity Exchange (DCE) rose 0.35percent to 711 yuan (USD105.94) a metric ton, as of 0147 GMT.
The benchmark October iron ore on the Singapore Exchange was 0.26percent higher at USD96.05 a ton, as of 0137 GMT, hovering below the key psychological level of USD100 for six straight sessions. Several steelmakers booked seaborne cargoes for the upcoming week-long National Day holiday break over October 1-7.
The daily transaction volume of seaborne cargoes jumped by 43percent to 1.41 million tons on Wednesday from the day before, data from consultancy Mysteel showed.
However, mills may slow their restocking as tumbling margins discouraged mills from ramping up output, curbing price upside, said analysts.
Other steelmaking ingredients also gained ground, with coking coal and coke up 1.18percent and 1.31percent, respectively. Steel benchmarks on the Shanghai Futures Exchange advanced.
Rebar added 0.1percent, hot-rolled coil ticked up 0.24percent, and stainless steel jumped 0.78percent. “The real steel demand has not shown clear signs of recovering, missing earlier expectations, but supply contraction persisted as losses exacerbated,” analysts at broker Zhengxin Futures said in a note.
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