Iron ore heads for weekly fall ahead of key China meeting

Iron ore futures are setfor a weekly fall amid a flurry of profit-taking, ahead of top consumer China’s third plenum, although growing expectations of U.S. rate cuts pushed up prices on Friday.

The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade0.3% higher at 827 yuan ($113.84) a metric ton. It is down3.2%week-on-week.

The benchmark August iron ore on the Singapore Exchange was 0.5%higher at $107.8 a ton, as of 0713 GMT, a drop of more than 2% from the closing price last Friday.

The prospect of easing monetary policy helped boost sentiment across the commodity complex, ANZ bank analysts said in a note.

“This week, the focus of (iron ore) trading shifted back to fundamentals,” said a Shanghai-based trader, requesting anonymity as he is not authorised to speak to media.

Iron ore prices are expected to remain under pressure from dwindling demand in the short term after hot metal output eyed a more obvious fall this week and losses among steelmakers exacerbated, analysts at Everbright Futures said in a note.

The average daily hot metal output among steelmakers surveyed declined for a third week by 0.4% from the prior week to around 2.38 million tons as of July 11, data from consultancy Mysteel showed.

Meanwhile, investors and traders are awaitingpossible stimulus from China’s Communist Party leadership meeting, which is scheduled for July 15-18 and will outline efforts to promote advanced manufacturing, revise the tax system to curb debt risks, manage a vast property crisis and revitalise the private sector, according topolicy advisers.

China’s iron ore imports fell 4.3% inJune from the previous month, customs data showed on Friday, as buyers reduced purchases amid high portside inventories and expectations of seasonally slow demand.

Other steelmaking ingredients on the DCE posted gains, with coking coal DJMcv1 and coke DCJcv1 nearly 1% and 0.6%,respectively.

Steel benchmarks on the Shanghai Futures Exchange moved sideways. Rebar SRBcv1 added 0.5%, hot-rolled coil SHHCcv1 ticked 0.3% higher, stainless steel SHSScv1 edged up nearly 0.2%, while wire rod SWRcv1 shed 0.3%.
Source: Reuters (Reporting by Amy Lv and Mei Mei Chu; Editing by Sonia Cheema and Sohini Goswami)