Singapore iron ore futures retreated on Monday as caution mounted after the world’s top consumer issued warnings on enhancing supervision on the market, and as investors awaited details from the government on property-related stimulus.
The benchmark December iron ore contract on the Singapore Exchange was down 0.64% at $133 a metric ton, as of 0705 GMT.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trading 0.36% higher at 980.5 yuan ($135.97) a ton.
China’s state planner said on Friday it would strengthen the supervision of iron ore at ports and guard against hoarding and speculation in order to maintain an orderly market, its second move within a week to curb a price rally.
A slew of stimulus related to the property market has been unveiled in the past weeks as part of efforts to revive the struggling sector, boosting sentiment and contributing to continuous price gains.
Weaker steel demand during winter months is also capping the price rise in iron ore.
“The retreat in iron ore prices is partly because steel prices have failed to register more gains after having met resistance from downstream consumers,” said Cheng Peng, a Beijing-based analyst at Sinosteel Futures.
“Prices will likely move within a tight range in the short run until there is another clear signal either from a start of the winter restocking or from fresh macro economic stimulus.”
Other steelmaking ingredients extended rally on expectation of tightening supply following production suspension at a few mines in top coal production hub north China’s Shanxi province after mining accidents surged.
Coking coal DJMcv1 and coke DCJcv1 on the DCE climbed 7.1% and 3.13%, respectively.
Steel benchmarks on the Shanghai Futures Exchange ticked up. Rebar SRBcv1 added 0.56%, hot-rolled coil SHHCcv1 rose 0.95%, wire rod SWRcv1 advanced 0.76%, while stainless steel SHSScv1 shed 0.18%.
Source: Hellenic Shipping News
