UNDATED, Mar 13: Iron ore hovered near a record low below $60 a tonne amid soft buying interest among Chinese steel mills, putting the spot price on course for a third weekly fall. A recovery in Chinese steel prices from all-time lows helped spur physical trading activity although bids for spot cargoes remained close to recent lows, traders said. Iron ore for immediate delivery to China’s Tianjin port <.IO62-CNI=SI> rose 0.4 percent to $57.90 a tonne on Thursday, just a tad above $57.70 touched the day before, the lowest level since The Steel Index began compiling prices in late 2008. The steelmaking commodity was down half a percent for the week so far, sharply narrowing its weekly loss from 7.6 percent last week, its steepest in almost two years. ‘Steel demand is starting to come back due to warmer weather. However big mills like Shagang and Baosteel are lowering their steel prices in order to move their inventory,’ said a trader in Singapore.
‘Steel prices are likely to remain sluggish as production remains high.’
On Friday, the most-traded October rebar on the Shanghai Futures Exchange was up 0.7 percent at 2,505 yuan ($400) a tonne by the midday break, recovering from Tuesday’s record low of 2,449 yuan.
China’s Baoshan Iron and Steel, the world’s No. 4 steel producer, said on Tuesday it will cut prices for its main steel products for April bookings.
Appetite for spot iron ore cargoes is ‘very poor. There’s too many cargoes floating out from Hedland and Dampier,’ said the Singapore trader, referring to the main iron ore ports in top supplier Australia.
‘Mills are not buying due to negative steel margins,’ he said. But ANZ Bank said iron ore prices were finding support from ‘renewed hopes that China would offer fresh stimulus measures.’ Chinese banks extended 1.02 trillion yuan ($163 billion) of new loans in February, well above market expectations, while growth in broad money supply quickened, as Beijing seeks to boost flagging economic growth.
(AGENCIES)
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