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Dalian iron ore extends gains on persistent demand hopes
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Singapore benchmark feels slight downward pressure
(Updates prices and adds bullet points)
BEIJING, March 8 (Reuters) - Dalian iron ore extended
gains on Wednesday as market participants bet on the prospect of
steel demand picking up since China has entered its peak
construction season.
Singapore benchmark iron ore, however, felt slight downward
pressure after Federal Reserve Chair Jerome Powell indicated the
U.S. central bank could raise interest rates at a faster pace.
The most-traded May iron ore futures contract on China's
Dalian Commodity Exchange (DCE) ended daytime trading
0.83% higher at 912 yuan ($130.95) a tonne, following a rise of
1.34% on Tuesday.
"Both supply and demand [of steel products] continue to
recover," analysts at Haitong Futures said in a note.
On the Singapore Exchange, the benchmark April iron ore was at $126.8 a tonne as of 0700 GMT, down 0.13%.
"Hawkish comments from central bankers weighed on sentiment
across markets. The subsequent risk-off tone saw commodities
come under pressure," analysts at ANZ bank said in a note.
China imported 194 million tonnes of iron ore in the first
two months of 2023, a year-on-year rise of 7.3%, customs data
showed on Tuesday, and the highest ever for the two months
combined, according to Reuters calculations.
Though futures price of coke–the other steelmaking
ingredient–showed signs of weakening, analysts believe
fundamentals will lend some support to spot prices in the near
term.
Coke fell 0.87% while coking coal managed
to shrug off its losses from the morning session to end daytime
trading 0.13% higher.
Rebar on the Shanghai Futures Exchange grew 0.26%
to 4,249 yuan a tonne, hot-rolled coil was flat and
wire rod nudged down 0.22%.
"The significant increase in exports eased supply pressure in the domestic market to some degree. Also, it boosted mills' confidence in holding their prices firm," analysts at Everbright Futures said in a note. Stainless steel slid 2.06%.
($1 = 6.9647 Chinese yuan) (Reporting by Amy Lv and Dominique Patton in Beijing; Editing by Sherry Jacob-Phillips and Savio D'Souza)
