Iron ore and steel futures in China gained in this week's three trading sessions, supported by surging demand from local mills as the country returns from lockdowns related to the coronavirus pandemic.
The most-traded iron ore futures on the Dalian Commodity Exchange, for September delivery, ended up 2.6% to 633 yuan ($89.52) a tonne, the highest since Aug. 1. Over the week it was up 3.8%.
There were only three trading sessions because of public holidays in China at the start of the week.
Iron ore prices are being propped up by robust demand at Chinese mills, according to three iron ore traders from Shandong and Jiangsu provinces.
"Domestic demand for steel products are unexpectedly good, which also benefits demand for raw materials," said the Shandong-based trader.
Weekly capacity utilisation rates at blast furnaces in 247 mills rose to 89.1% as of Friday, data compiled by Mysteel consultancy showed.
There are also rising concerns of potential supply disruptions in Brazil, China's second-largest iron ore supplier.
The country posted a record number of coronavirus cases and deaths on Wednesday, raising the chances of travel restrictions and stay-at-home orders. Brazil has already imposed a lockdown on the northeastern city of São Luis, an iron ore-loading port.
Construction steel rebar on the Shanghai Futures Exchange , for October delivery, closed up 0.9% to 3,452 yuan per tonne, sending its weekly gain to 2.5%.
Hot-rolled coil, used in cars and home appliances, jumped 1.5% to 3,327 yuan a tonne.
Steel inventories held by traders in main cities across China fell by 658,300 tonnes to 18.11 million tonnes as of Thursday, according to Mysteel.
Stainless steel futures, for June delivery, edged down 0.5% to 13,190 yuan a tonne.
Other steelmaking ingredients were mixed, with coking coal down 0.2% to 1,090 yuan a tonne while coke rose 1.0% to 1,750 yuan a tonne.
Spot prices of iron ore with 62% iron content for delivery to China rose to $84.8 per tonne on Thursday.
More than 3.86 million people have been reported to be infected by the novel coronavirus globally and 268,620 have died, according to a Reuters tally.
Australia's shipments of iron ore to China from the world's top export hub of Port Hedland jumped to 38.7 mln tonnes in April, data from the port authority showed on Friday.
Nippon Steel's president said the company will not be able to avoid big loss in the first half of the year.
Top trade representatives of China and the United States held a phone call on Friday and agreed to strengthen macroeconomic and public health cooperation, China's commerce ministry said in a statement.
The China Association of Automobile Manufacturers said in a statement on Thursday that it expected vehicle sales in China were likely to rise in April and snap almost two years of declines.
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