Dalian iron ore extends climb, shrinking margin caps gain

Kitco Media
By Reuters
Published:
Updated:
Reuters
BEIJING, March 30 (Reuters) - Dalian iron ore futures on Thursday eyed their fourth straight session of gain, supported by prospects of demand recovery after steel consumption was temporarily capped by rainy weather in many regions last week. The most-traded May iron ore futures contract on the Dalian Commodity Exchange (DCE) added 0.39% to 892 yuan ($129.32)a tonne as of 0212 GMT. "Hot metal output still has some room for further growth in the short run, lending support to the upstream ore market," analysts at Huatai Futures said in a note. Mills' interest in restocking raw materials depends on how steel demand actually performs and the shrinking steel margins due to falling steel prices will cap room for iron ore price gains, they added. On the Singapore Exchange, the most-active May iron ore contract was 0.37% lower at $122.4 a tonne as of 0224 GMT. Other steelmaking ingredients-coking coal and coke both posted losses in the morning trading session with the former falling 0.49% and the latter dipping 0.52%. Steel futures prices were mostly on the downtrend but analysts expect growing demand to support the market in the near term.


Rebar on the Shanghai Futures Exchange dropped by 0.12% to 4,140 yuan a tonne, wire rod declined 0.36%, and stainless steel shed 2.4%. Hot-rolled coil edged up 0.05%, though. "Both production and apparent demand of construction steel products picked up slightly this week, while inventories eyed obvious drops. The market is still holding a strong expectation of economic recovery," analysts at Everbright Futures said in a morning note.
($1 = 6.8975 Chinese yuan) (Reporting by Amy Lv and Dominique Patton)

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