Dalian iron ore futures prices faltered on Thursday, surrendering earlier gains as uncertainty surrounding top consumer China’s fiscal stimulus plans clouded market sentiment, although firmer seasonal demand for steel products limited losses.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade1.02% lower at 775.5 yuan ($109.65) a metric ton.
The benchmark November iron ore SZZFX4 on the Singapore Exchange was 0.65% lower at $104.2 a ton, as of 0705 GMT.
Commodities markets remain under pressure as hopes of further Chinese stimulus measures faded, said ANZ analysts in a note.
Still, iron ore futures gained earlier after China announced another briefing on policy support, boosting speculation of more stimulus measures, added ANZ.
China’s finance ministry will detail plans on fiscal stimulus to boost the economy at a highly expected news conference on Saturday, the government saidon Wednesday, signalling more forceful policies to revive growth.
It is uncertain if administrative procedures for possible fiscal moves are complete, as major deviations from the budget or deficit target typically need to be approved by the National People’s Congress, said ING analysts.
“Regardless, wecontinue to expect a fiscal stimulus push in the coming weeks and months and have upgraded our 2025 growth forecast from 4.6% to 4.8% year-on-year in anticipation of stronger policy support,” said ING.
Meanwhile, robust seasonal demand in the steel market’s key “golden October” period is supporting an improvement in the supply-demand balance for industrial steel products, said Chinese consultancy Steelhome.
“Prices of spot rebar rose to their highest level in more than two months, and steel mill margins have also improved in recent weeks,” the ANZ analysts said.
Other steelmaking ingredients on the DCE were weaker, with coking coal and coke down3.23% and 2.56% respectively.
Most steel benchmarks on the Shanghai Futures Exchange posted losses. Rebar dropped 1.66%, hot-rolled coil shed nearly 0.9%, stainless steel declined 0.57%, and wire rod was flat.
Source: Reuters
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