*
Warmer weather raises expectations of demand pick-up
*
China daily crude steel output seen at 2.69 mln T for Feb
21-28
- CISA
(Updates prices and adds bullet points)
BEIJING, March 7 (Reuters) - Dalian and Singapore iron
ore futures rose on Tuesday, as warmer weather raised
expectations for a pickup in steel demand and the market focused
on improving consumption fundamentals.
The most-traded May iron ore contract on China's Dalian
Commodity Exchange (DCE) ended daytime trading 1.34%
higher at 909.5 yuan ($131.09)a tonne, after a 2.13% fall on
Monday.
On the Singapore Exchange, the benchmark April iron ore was at $126.7 a tonne as of 0700 GMT, up 1.93%.
"The rise in (iron ore) prices is primarily driven by
expectation of continuously recovering downstream (steel)
demand," said Pei Hao, a Shanghai-based senior analyst from FIS,
an international brokerage firm.
The market had been under pressure on concerns that
authorities could take action to curb rising prices following a
government meeting on Friday.
"Now, it seems that the fundamental factors have begun to
play a dominant role again," Pei said.
The average concrete capacity utilisation rate and
construction steel products transaction volumes have increased
recently, indicating a recovery in the downstream steel
consumption sectors, Everbright Futures said in a note.
China likely produced about 2.69 million tonnes of crude
steel per day from Feb. 21 to 28, a rise of 5.16% from the
previous 10-day period, the China Iron and Steel Association
(CISA) said on its official website on Monday.
Other steel-making raw materials, coking coal and coke,
shrugged off mild gains achieved in the morning session.
Coking coal futures fell 0.65% and coke futures dipped by 0.38%, although some domestic coking plants raised their spot coke offer prices by 100 yuan a tonne from Tuesday, consultancy Mysteel said in a report. Rebar on the Shanghai Futures Exchange climbed 0.83% to 4,248 yuan a tonne, hot-rolled coil gained 0.37% and wire rod rose 0.43%. Stainless steel fell 0.92%. ($1 = 6.9381 Chinese yuan renminbi) (Reporting by Amy Lv and Dominique Patton in Beijing; Editing by Subhranshu Sahu and Jamie Freed)
