Iron ore futures rebounded on Tuesday, supported by supply concerns and renewed expectations of further stimulus from Beijing, although weak downstream steel demand remained a key constraint on the market.
The strike at Port Hedland has now lasted around one month, with the two sides yet to reach an agreement on pay. While its impact on overall shipments remains limited, the prolonged dispute has provided some support to iron ore sentiment.
Recent weak Chinese economic data has also fueled expectations of further stimulus from Beijing. Slower industrial production and retail sales growth, along with continued weakness in fixed-asset investment and the property sector, have raised hopes that additional policy support could help underpin economic activity and steel demand.
Chinese steel mills continue to operate at relatively low output levels, while persistent weakness in steel demand has prompted some producers to bring forward maintenance. This is expected to weigh on near-term iron ore consumption.
Analysts said the recent technical rebound in iron ore futures from an earlier periodic low has not been matched by stronger spot activity. Spot transactions remain within a narrow seasonal range, while tight steel mill margins are expected to limit the pace of any recovery.
On the Dalian Commodity Exchange, the most-traded iron ore contract rose 0.85pct to 714 yuan (USD 105.8) per ton. Coke futures increased 1.38pct to 1,950 yuan (USD 289) per ton, while coking coal futures gained 1.58pct to 1,546.5 yuan (USD 229) per ton.
On the Shanghai Futures Exchange, rebar futures rose 0.17pct to 3,023 yuan (USD 448) per ton, while HRC futures increased 0.34pct to 3,281 yuan (USD 487) per ton. Wire rod futures inched higher to 3,277 yuan (USD 486) per ton. Stainless steel futures increased 0.81pct to 14,330 yuan (USD 2,125) per ton.
1 USD / 6.74 yuan
| Item | Closing Price (in yuan) | Difference from Night Session (pct) | Difference from Previous Morning Session (pct) |
|---|---|---|---|
| Wire Rod | 3,277.00 | ▲ 0.03 | ▼ -0.34 |
| Hot Rolled Coils | 3,281.00 | ▲ 0.34 | ▲ 0.30 |
| Rebar | 3,023.00 | ▲ 0.17 | ▲ 0.23 |
| Stainless Steel | 14,330.00 | ▲ 0.81 | ▲ 0.38 |
| Iron ore | 714.00 | ▲ 0.85 | ▲ 1.05 |
| Coke | 1,950.00 | ▲ 1.38 | ▼ -2.77 |
| Coking Coal | 1,546.50 | ▲ 1.58 | ▲ 1.58 |