China iron ore slips; posts best weekly jump in seven on strong demand outlook
Iron ore futures slipped on Friday, but China’s benchmark contract marked its biggest weekly gain since mid-May as optimism grew over prospects of demand in the world’s top producer and consumer of steel products.
Prices came under pressure after Australian port data showed shipments of iron ore to China from the world’s top export hub of Port Hedland climbed in June to a record of 46.2 million tonnes.
The most-traded iron ore for September delivery on China’s Dalian Commodity Exchange ended the session 0.1% lower at 790.50 yuan ($112.79) a tonne, snapping a five-day winning streak. For the week, it rose 6.3%, the biggest weekly jump since the week ending May 22.
The Dalian contract has also risen 6.3% so far in July, after a post-lockdown gain of 29% in the second quarter.
Iron ore’s August contract on the Singapore Exchange retreated 0.3% to $102.82 a tonne in afternoon trade after six straight sessions of gains.
This week, the spot price of benchmark ore with 62% iron content scaled its highest in 11 months, to $107 a tonne on Thursday, according to data from SteelHome consultancy.
“Iron ore drew support from strong China demand, together with supply disruptions in Brazil linked to COVID-19 restrictions on activity at some mines,” said Ray Attrill, head of FX strategy at National Australia Bank, citing higher commodity prices’ support for the Australian dollar.
* June iron ore shipments from Port Hedland, used by three of Australia’s top four iron ore miners, rose by 7% from May’s 43.18 million tonnes, and were up 10% from the same month last year.
* Construction steel rebar on the Shanghai Futures Exchange edged down 0.8% after a six-session rally, while hot-rolled coil dropped 0.5% after a five-day advance.
* Stainless steel lost 0.9%.
* Coking coal and coke also retreated, down 1.1% and 1.8%, respectively.
Source: Reuters (Reporting by Enrico dela Cruz; Editing by Subhranshu Sahu and Rashmi Aich)