BEIJING: Dalian iron ore futures prices fell for a second straight day on Tuesday, weighed down by lingering concerns over demand for the key steelmaking ingredient in top consumer China.
The most-traded iron ore contract on China’s Dalian Commodity Exchange (DCE) closed daytime trade 0.51 percent lower at 788 yuan (USD113.26) a metric ton.
The benchmark January iron ore on the Singapore Exchange was up 0.26 percent at USD103.8 a ton, as of 0653 GMT.
More steel mills have started equipment maintenance in the run-up to the Lunar New Year holiday in February, dampening appetite for feedstocks including iron ore, analysts at broker Zhengxin Futures said in a note.
Steelmakers in China typically conduct furnace maintenance during winter when demand weakens in the northern region as low temperature hinders outdoor construction activity.
Moreover, expectation of weak steel exports this year undermined buying interest for iron ore amid forecasts of a supply glut, analysts at broker First Futures said in a note.
China’s steel exports hit a record high last year, but growing protectionism backlash against cheap Chinese steel, coupled with Beijing’s introduction of a licence regime, cast shadow on prospects of demand outside China this year, said analysts.
The persistent pick-up in portside inventory also pressured iron ore prices, according to Guiqiu Zhuo, an analyst at broker Jinrui Futures.
“But anticipation that there might be another wave of feedstock restocking with the Lunar New Year holiday approaching while mills could still make some money capped the downside room,” he said.