BEIJING: Prices of Singapore iron ore futures rose on Tuesday, driven by expectations of increased demand as steelmakers in the northern region of China, the top consumer, are set to resume production following the conclusion of its annual parliament meeting.
However, gains were capped by concerns over demand, with a potential steel output cut in China this year and escalating global trade friction stirred by the latest tariffs by the US President Donald Trump.
The benchmark April iron ore on the Singapore Exchange climbed 0.76% to $100.65 a metric ton, as of 0321 GMT, after touching the lowest level since January 14 at $98.85 a ton earlier in the session.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) closed morning trade 0.19% lower at 773.5 yuan ($106.73) a ton.
“Hot metal output still has upside room in March as some steelmakers in North China will likely ramp up production after the ‘Two Sessions’,” analysts at Chaos Ternary Futures said in a note.
Two Sessions, China’s annual legislative meetings, kicked off on March 4 and will conclude later in the day.
Hot metal output is typically used to gauge iron ore demand.
Prices of key steelmaking ingredients fell on Monday, driven by weak macro sentiment as hopes for additional stimulus from China faded and concerns over the potential impact of new tariffs from Trump clouded demand prospects.
Other steelmaking ingredients on the DCE retreated, with coking coal and coke down 1.39% and 1.03%, respectively.
Most steel benchmarks on the Shanghai Futures Exchange languished. Rebar fell 0.93%, hot-rolled coil lost 0.48%, wire rod shed 1.33% and stainless steel added 0.11%.
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