BEIJING: Dalian and Singapore iron ore futures extended gains for a fourth session on Friday, underpinned by rising hopes of stimulus measures in China after weaker export data as well as lower inventories at both mills and ports.
The most-traded September iron ore on the Dalian Commodity Exchange (DCE) traded 1.63% higher at 841.5 yuan ($117.86) a metric ton, as of 0215 GMT, the strongest since March 17. The benchmark August iron ore on the Singapore Exchange was 2.6% higher at $112.4 a metric ton, as of 0243 GMT, the highest since April 12.
China’s exports fell last month at their fastest pace since the onset three years ago of the COVID-19 pandemic. Iron ore rose in tandem with hopes that Beijing would deliver more economic aid for the beleaguered property sector, as investors shrugged off the disappointing trade data, analysts at National Australia Bank said in a note.
Meanwhile, iron ore inventories at the surveyed 247 steel mills declined by 1.3% on the week to 85.22 million metric tons as of July 14, while stocks at the surveyed 45 ports fell for the fourth consecutive week by 1.1% on the week to 124.95 million metric tons, data from consultancy Mysteel showed.
The softening US dollar, following better-than-expected economic data, also lent a hand in boosting prices. Other steelmaking ingredients-coking coal and coke on the DCE added 1.98% and 1.59%, respectively. Chinese coke producers raised their offer prices for the second round by 50 yuan per metric ton, which is expected to be eventually accepted by mills, said analysts.
Steel benchmarks on the Shanghai Futures Exchange broadly climbed on higher raw materials costs, though the room for gains was capped by sluggish demand. Rebar advanced 0.73%, hot-rolled coil added 0.42%, wire rod grew 0.34% and stainless steel ticked up 0.17%.
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