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SGX iron ore hits lowest in nearly three weeks
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Dalian iron ore ends choppy day session firmer
(Updates prices)
By Enrico Dela Cruz
Feb 6 (Reuters) - Singapore iron ore futures fell on
Monday to their lowest in nearly three weeks, while Dalian
prices see-sawed, as traders curbed their optimism about demand
prospects in top steel producer China.
Iron ore's benchmark March contract on the
Singapore Exchange was down 1.2% at $123.40 a tonne, as of 0746
GMT. Earlier in the day it hit its weakest since Jan. 18 at
$121.15, and on Friday marked its first weekly loss this year.
On China's Dalian Commodity Exchange, the steelmaking ingredient's most-active May contract ended daytime trade 0.9% higher at 853.50 yuan ($125.85) a tonne, rebounding after hitting a session-low 835 yuan. In the spot market, the 62% Fe ore bound for China was assessed at $127 a tonne on Friday, based on SteelHome consultancy data . The benchmark grade hit its highest since mid-June at $130.50 on Jan. 30. "We expect to witness some immediate downside for iron ore prices this week, as supply- and demand-side fundamentals temporarily loosen," Navigate Commodities Managing Director Atilla Widnell said. Steel demand in China has yet to pick up after the Lunar New Year holidays, partly indicated by rising inventories, while the production rate has marginally improved, analysts said. The blast furnace capacity utilization rate among 247 steel mills across China surveyed by Mysteel consultancy was at 84.32% as of Feb. 2, up by 0.18 percentage point from Jan. 27. Traders were seen waiting for signals of further policy support for the Chinese economy. However, China's policymakers have ruled out flood-like stimulus even as they plan to show more support for domestic demand this year. Other Dalian steelmaking inputs also erased early losses, with coking coal and coke up 1.8% and 0.4%, respectively. Rebar on the Shanghai Futures Exchange climbed 0.5% and hot-rolled coil rose 1%, while wire rod shed 0.4%. Stainless steel advanced 0.9%. (Reporting by Enrico Dela Cruz in Manila; Editing by Nivedita Bhattacharjee and Rashmi Aich)
