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China iron ore futures range-bound on falling shipments, demand uncertainty

Chinese iron ore futures dipped at market close on Thursday, after gaining more than 2% boosted by falling shipments from major miners, as concerns remain about short-term demand for the steelmaking ingredient.

Exports of iron ore from Australia and Brazil stood at 22.35 million tonnes for the week ended Jan. 9, down 5.61 million tonnes compared with the week earlier, according to data from Mysteel consultancy.

However, despite molten iron output gradually recovering on easing environmental controls, supporting spot market prices, there’s still worries on steel output curbs during the Beijing Winter Olympics, Galaxy Futures wrote in a note.

Spot prices of iron ore with 62% iron content for delivery to China rose $3 to $132 per tonne on Wednesday, according to SteelHome consultancy.

Benchmark iron ore futures on the Dalian Commodity Exchange , for May delivery, rose as much as 2.4% to 749 yuan ($117.74) per tonne and retreated to end 0.7% lower at 726 yuan a tonne.

Other steelmaking ingredients also stepped back from gains during the morning session, with coking coal dipping 0.9% to 2,305 yuan per tonne and coke futures closing down 1.9% at 3,106 yuan a tonne.

The most active steel rebar contract on the Shanghai Futures Exchange closed up 0.7% at 4,633 yuan per tonne.

Hot rolled coils futures, used in cars and home appliances, inched up 0.2% to 4,739 yuan a tonne.

China’s auto sales last year grew for the first time since 2017, and are expected to perform better in 2022, according to an industry association.

Shanghai stainless steel futures for February delivery fell 1.9% to 17,650 yuan a tonne. ($1 = 6.3615 Chinese yuan renminbi)
Source: Reuters (Reporting by Min Zhang in Beijing and Enrico Dela Cruz in Manila; Editing by Subhranshu Sahu and Shounak Dasgupta)

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