Iron ore futures posted gains on Thursday amid expectations of further stimulus measures by the Chinese government to bolster the struggling economy.
Deputy head of the state economic planner, Li Chunlin, announced that supporting measures to address challenges faced by private firms and policies to encourage private investment will be rolled out soon.
However, concerns remain over rising iron ore supplies, environment-related production restrictions, and weak steel demand. Analysts pointed out that the high levels of debt will limit the size of the stimulus package and, as a result, will have a limited impact on the demand for steel and its raw materials.
Dalian iron ore futures for the September contract rose by 1.74 pct, settling at 849.5 yuan (USD 117.6) per ton. Coke and coking coal futures also extended their gains during the morning trading session, with increases of 2.41 pct and 4 pct, respectively, reaching 2,298.5 yuan (USD 318) per ton and 1,534 yuan (USD 212.5) per ton. The surge in coke and coking coal futures was triggered by supply concerns following accidents at coal mines in Shanxi and Liaoning provinces, prompting authorities to tighten inspections.
In the Shanghai Futures Exchange, rebar futures grew by 1.37 pct, reaching 3,784 yuan (USD 524) per ton, while HRC futures rose by 1.41 pct to 3,887 yuan (USD 538) per ton. Wire rod futures also increased by 1 pct, settling at 4,103 yuan (USD 568) per ton. Stainless steel futures experienced a substantial rise of nearly 3 pct, reaching 15,350 yuan (USD 2,126) per ton.
1 USD / 7.21 yuan
