Iron ore futures displayed varied trends on Thursday, with the Dalian benchmark rising for the third consecutive session, supported by China’s recent initiatives to stimulate its struggling property market. The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade up by 1.2%, reaching 819 yuan ($112.67) per metric ton. In contrast, the benchmark July iron ore contract on the Singapore Exchange dropped by 0.9% to $105.65 a ton as of 0718 GMT, after initially gaining and peaking at $107.45 a ton earlier in the morning. This decline was influenced by weak industrial data and concerns over high portside stockpiles.
On Wednesday, Beijing introduced measures aimed at reducing home buying costs, including lowering mortgage interest rates and the minimum down-payment ratio, in an effort to revitalise the local property market. Analysts noted that expectations of near-term resilient demand provided a boost to iron ore prices, with Everbright Futures projecting that average daily hot metal output in July will be around 2.37 million tons, indicating a steady demand for ore.
Moreover, traders’ optimism was further lifted by a Hong Kong court’s decision to postpone the liquidation hearing for Chinese property developer Shimao Group Holdings to July, allowing more time for debt restructuring plans. However, the gains were tempered by official data revealing a slower rise in China’s industrial profits in May, highlighting the challenges faced by the world’s second-largest economy due to weak domestic demand.
Other steelmaking ingredients on the DCE also saw a reduction in gains, with coking coal and coke falling by 0.32% and 0.11%, respectively. Meanwhile, steel benchmarks on the Shanghai Futures Exchange showed mixed results, with rebar dipping by 0.2%, hot-rolled coil remaining largely unchanged, wire rod decreasing by 0.3%, and stainless steel rising by 0.8%.
Alien Metals Ltd (LON:UFO) is a global minerals exploration and development company that will shortly make the transition to iron ore producer. The company was formed from Arian Silver in late 2018, retaining some of the companies more valuable Mexican projects before embarking on an acquisition led strategy, headed up by an excellent geological team and targeted entirely on Western Australia.
