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China Feb official manufacturing PMI highest since April
2012
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China revises 2022 crude steel output
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Subdued demand, high inventories weigh on stainless steel
(Updates prices and most-traded contract for Singapore
benchmark)
BEIJING, March 1 (Reuters) - Iron ore futures jumped on
Wednesday, as better-than-expected China manufacturing activity
data raised hopes for a demand rebound in the world's top steel
producer.
The most-traded May iron ore futures contract on the Dalian
Commodity Exchange (DCE) ended daytime trade 2.42%
higher at 908.5 yuan ($131.64) a tonne, after closing about 0.8%
lower in the previous session.
On the Singapore Exchange, the benchmark April iron ore was up 2.17% at $126.05 a tonne, as of 0703 GMT,
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.
Coke, one of steelmaking ingredients, also showed signs of
strength. Coke rose 1.86%, while coking coal was little changed at 2,033.5 yuan a tonne.
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 1.1%,
hot-rolled coil climbed 1.1% and wire rod moved up 0.98%. Stainless steel fell 1.36%, 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.
($1 = 6.9016 Chinese yuan)
(Reporting by Amy Lv and Dominique Patton in Beijing; Editing
by Subhranshu Sahu)
