Iron ore futures rebounded on Thursday as the market weighed recent stimulus measures from Beijing, despite ongoing concerns about steel demand.
According to an official policy document, China has broadened the scope of a consumer goods trade-in program to stimulate subdued domestic demand. These new measures have sparked some optimism about a potential recovery in domestic consumption.
However, rising port-side iron ore inventories and declining steel production continue to pose challenges for the key steelmaking raw material. Daily crude steel output among member mills of the China Iron and Steel Association (CISA) fell by 5.3pct during late December (December 21-31), averaging 1.87 mln tons per day, compared to mid-December.
Adding to the concerns, recent economic data indicated a slowdown in domestic consumer inflation in December, while factory-gate deflation persisted for the second consecutive year, dampening the outlook for iron ore demand.
On the Dalian Commodity Exchange, iron ore futures rose by 0.53pct to 754.5 yuan (USD 102.9) per ton. Conversely, coke and coking coal futures fell by 0.79pct and 1.48pct to 1,697 yuan (USD 231) per ton and 1,097 yuan (USD 150) per ton, respectively.
Meanwhile, on the Shanghai Futures Exchange, rebar futures dropped by 0.65pct to 3,205 yuan (USD 437) per ton, while hot-rolled coil (HRC) futures declined by 0.57pct to 3,313 yuan (USD 452) per ton. Wire rod futures decreased by 0.62pct to 3,512 yuan (USD 479) per ton. In contrast, stainless steel futures rose by 1.58pct to 13,180 yuan (USD 1,798) per ton.
1 USD / 7.33 yuan
