Chinese steel futures fall, weigh on iron ore as demand falters

Date 1/12/2018 2:55:13 PM Source: Reuters

    SHANGHAI, Jan 12 (Reuters) - Chinese steel futures fell on Friday after gaining for three straight days and were on track for their biggest daily loss in one month as cooling winter demand weighed on iron ore, the key steelmaking raw material.

    Steel traders and end users are reluctant to restock on expectations that faltering demand in winter months would continue to dent prices. 

    "Steel traders are cautious at the moment and reluctant to start buying. They would consider restocking if physical prices fall further," said Zhao Chaoyue, an analyst with Merchant Futures in Shenzhen.

    "The government-imposed production curbs at steel mills seem less stricter than the beginning of the smog campaign in mid-November. Weak steel prices will continue pressuring iron ore," Zhao added.

    The most active rebar on the Shanghai Futures Exchange SRBcv1 dropped 1.5 percent to 3,794 yuan ($585.40) a tonne by midday.

    Iron ore on the Dalian Commodity Exchange DCIOcv1 fell 1.9 percent to 545 yuan a tonne.

    Chinese iron ore imports fell 11 percent in December at 84.3 million tonnes from the previous month, but full-year shipments rose 5 percent to a record high of 1.075 billion tonnes from 2016, exceeding 1 billion tonnes for a second year, customs data showed on Friday. 

    Coke DCJcv1 slipped 0.7 percent to 2,010.5 yuan a tonne and coking coal DJMcv1  fell 1.3 percent to 1,346.5 yuan a tonne, respectively.    

    Iron ore for delivery to China's Qingdao port .IO62-CNO=MB rose $0.77 to 79.08 a tonne on Thursday, according to Metal Bulletin. 

($1 = 6.4810 Chinese yuan renminbi)



Edited by SHMET