asia

Asia's iron ore futures at record high as spot crosses $200/T on robust demand


Iron ore futures in Asia vaulted to a record high on Friday, extending their rally as strong demand for the steelmaking raw material in China and supply concerns pushed spot prices for the benchmark material to the highest-ever above $200 a tonne.

The most-liquid September iron ore on China’s Dalian Commodity Exchange DCIOcv1 leapt 5.3% to 1,214 yuan ($187.94) a tonne by 0330 GMT, after earlier touching a high of 1,217.50 yuan.

June iron ore on the Singapore Exchange SZZFM1 advanced 1.5% to $198.35 a tonne.

Spot prices for imported iron ore in China’s portside and seaborne cargo markets soared on Thursday amid pent-up demand after the nation’s five-day Labour Day holiday.

Mysteel’s SEADEX 62% Australian fines rose by $10.95 per dry metric tonne from Wednesday to $201.15/dmt CFR Qingdao, the highest since the consultancy’s index assessment started in January 2010.

Dalian iron ore has risen 9.5% this week despite the holiday, on track to mark its best week since mid-December. Demand has become stronger particularly for high-grade and less-pollutive materials.

“Recent production cuts in Tangshan have boosted demand for higher-quality ore and prompted mills to build iron ore inventories as their margins are on the rise with steel supply being restricted,” said CRU Group’s principal steel analyst Erik Hedborg in London.

Hedborg was referring to China’s top steelmaking city where stricter anti-pollution standards have been implemented.

To further improve air quality, China will tighten steel production capacity swap controls in key areas suffering from air pollution.

Supply concerns also provided a boost to iron ore prices amid signs of deteriorating relations between top steel producer China and biggest iron ore supplier Australia.

Steel prices on the Shanghai Futures Exchange stretched gains to hit fresh record highs, with construction steel rebar SRBcv1 up 1.3%, while hot-rolled coil SHHCcv1 climbed 2%. Stainless steel SHSScv1 advanced 0.3%.

Dalian coking coal DJMcv1 gained 1.5% while coke DCJcv1 jumped 2.7%.
Source: Reuters (Reporting by Enrico Dela Cruz in Manila, Editing by Sherry Jacob-Phillips)





READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.  Learn more