Save
PrintShanghai steel futures fell to their weakest level in nearly two months on Wednesday as Chinese markets reopened after a long holiday weekend with buyers opting for caution amid a still shaky outlook for steel demand.
Spot iron ore prices were mostly steady with weaker steel prices giving Chinese producers less impetus to pick up fresh iron ore cargoes.
The most-traded rebar contract for October delivery on the Shanghai Futures Exchange dropped 0.6 percent to close at the session low of 4,245 yuan ($670) a tonne, the lowest since March 7.
Chinese markets were shut on Monday and Tuesday for a public holiday.
"While a lot of the smaller mills are running low on stocks, they are not going to build inventories aggressively when the direction of the steel market is unclear," a Shanghai-based trader said.
"And they are not worried about a shortage of material because they can get them anytime, and even cheaper, from the ports."
Stockpiles of imported iron ore have mostly fallen since topping 101 million tonnes in February, standing just above 97 million tonnes last week.
Offer prices for imported iron ore in China were mostly unchanged on Wednesday, except for some Indian cargoes, based on data from industry consultancy Umetal.
Indian 63.5/63 grade ore was quoted at $148-$150 a tonne, including freight, up $1 from Friday, and offers for lower grade Indian material also rose by a dollar.
Sluggish steel demand in China, the world's biggest consumer and producer, where trader-held inventories of steel products were not falling as fast as they did last year, had weighed on producers' demand for iron ore.
But China's manufacturing sector showed fresh signs of bottoming out in April, with export orders ticking up, although activity still contracted for a sixth consecutive month, according to a survey by HSBC.
An expected improvement in supplies from top exporters Australia and Brazil during the second quarter, after bad weather cut January-March shipments, is also seen limiting any potential rebound in iron ore prices.
"So with this big pressure from the supply side, some people feel prices may not recover very soon," the Shanghai trader said.
Top miner Vale is selling 109,700 tonnes of 63.72-percent grade sinter feed ore via a tender on Wednesday, said a trader in Hong Kong, and market players are eyeing the pricing for trading cues.
Vale last week sold 63.74-percent grade sinter feed at $146.52 a tonne, slightly lower than a prior sale.
Benchmark iron ore with 62 percent iron content was unchanged at $145.40 a tonne on Tuesday, according to the Steel Index. （Source：Reuters）
Copyright © 2013 Ferro-Alloys.Com. All Rights Reserved. Without permission, any unit and individual shall not copy or reprint!
- [Editor:editor]
Daily News
Research
Magazine
Company Database
Customized Database
Conferences
Advertisement
Trade
Tell Us What You Think