($1 = 6.9249 yuan) (Reporting by Amy Lv and Dominique Patton in Beijing; Editing by Subhranshu Sahu)
BEIJING, March 1 (Reuters) - Iron ore futures jumped on
Wednesday, as better-than-expected China manufacturing activity
data raised prospects of a pickup in demand from the world's top
steel producer.
The most-traded May iron ore futures contract on the Dalian
Commodity Exchange (DCE) was 1.97% higher at 904.5
yuan ($130.62) a tonne, as of 0215 GMT, after closing about 0.8%
lower in the previous session.
On the Singapore Exchange, the benchmark March iron ore was up 1.18% at $125.55 a tonne, extending gains.
China's manufacturing purchasing managers' index
(PMI)climbed to 52.6 last month, the highest reading since April
2012, up from 50.1 in the previous month.
"We believe the better-than-expected data has injected some
confidence into the market. Also, the expectation of continued
improvement in downstream (steel) demand lent support to the
prices of raw materials including iron ore," said Yu Chen, a
Shanghai-based senior iron ore analyst at consultancy Mysteel.
Chinese steel mills are expected to replenish iron ore
inventories to meet production needs after some mills resumed
production, analysts from Huatai Futures said in a note, adding
that the hot metal output had improved steadily.
Coking coal and coke, also steelmaking ingredients, showed
signs of strength. Coking coal rose 0.59%, while coke grew 1.93%.
Along with improved demand from downstream steel consumption
sectors, strong raw material prices also lent support to the
steel market.
Rebar on the Shanghai Futures Exchange rose 1.18%,
hot-rolled coil climbed by 1.1% and wire rod moved up 0.98%. Stainless steel fell 1.06%, though.
"Demand (for stainless steel) is typically lacklustre in the
first quarter (of a year). Moreover, the comparatively high
stocks in Wuxi and Foshan warehouses also weighed on prices,"
said Ellie Wang, a Shanghai-based senior nickel analyst from
consultancy CRU Group.
China revised its total crude steel output to approximately
1.018 billion tonnes for 2022, marking a year-on-year fall of
1.7%, NBS data released on Tuesday showed. Previously, it had
reported 2022 output at 1.013 billion tonnes, down 2.1%
year-on-year.
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