SINGAPORE: Iron ore futures prices traded within a thin range on Tuesday, as investors weighed resilient near-term demand for the steelmaking ingredient against subdued economic data from top consumer China.
The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) held its ground at 723.5 yuan ($100.17) a metric ton, as of 0252 GMT.
The benchmark June iron ore on the Singapore Exchange was trading 0.15% higher at $99.6 a ton. “Production among Chinese iron ore mining enterprises continued rising last week as operations resumed at more mines,” said consultancy Mysteel.
The total volume of iron ore concentrate produced increased 2% week-on-week to reach 498,800 tons a day on average, according to data from Mysteel.
Hot metal output, typically used to gauge iron ore demand, dipped 0.35% month-on-month to 2.45 million tons, said broker Everbright Futures.
While hot metal output fell slightly month-on-month, production is still relatively high, and the demand for steel in manufacturing continues to grow, said broker Galaxy Futures.
On the supply-side, shipments of iron ore from major producers Australia and Brazil increased 9.53% month-on-month to 33.48 million tons, said broker Hexun Futures in a note.
Broadly, sentiment was also hit by slowing growth in China’s factory output and retail sales numbers that missed expectations while stagnation in new home prices continued.
China’s crude steel output in April slid 7% from March, though production was still reasonably high, data showed on Monday. Other steelmaking ingredients on the DCE languished, with coking coal and coke down 0.76% and 0.98%, respectively.
Steel benchmarks on the Shanghai Futures Exchange lost ground. Rebar was down 0.39%, hot-rolled coil eased 0.19%, wire rod dipped 0.54% and stainless steel lost nearly 1%.