keywords :
Iron ore futures dipped on Thursday, with the Dalian benchmark retreating from a three-day advance spurred by China’s pledge to step up support for the struggling property sector as traders sought details of policy measures and further action.
Prospects of increased supply of the steelmaking ingredient also weighed on prices as miner Fortescue FMG.AX forecast higher shipments for the 2024 fiscal year, adding to increasing deliveries by peers Rio Tinto RIO.AX and BHP Group BHP.AX
The most-traded September iron ore on China’s Dalian Commodity Exchange DCIOcv1 ended daytime trading 1.9% lower at 848.50 yuan ($118.82) per metric ton.
On the Singapore Exchange, the focus shifted back to the August iron ore contract SZZFQ3, which was down 2.3% at $112.30 per metric ton, as of 0700 GMT.
“The market is now awaiting more actions and follow-through,” Nomura analysts said in a note, after China’s top leaders this week signalled more stimulus steps to rejuvenate the world’s second-largest economy and top steel producer.
“The sustainability of this renewed hope crucially depends on details of any stimulus package – which so far is still lacking,” the analysts said.
Rio, the world’s biggest iron ore producer, was cautiously optimistic on China’s economy over the rest of the year, CEO Jacob Stausholm said on Wednesday.
Adding to the cautious mood, southern China was bracing for powerful typhoon Doksuri, which was expected to hit provinces, including the manufacturing hub of Guangdong, later this week, said Atilla Widnell, managing director at Navigate Commodities in Singapore.
Tighter environmental restrictions on Chinese heavy industries also weighed on sentiment, he said.
Other steelmaking inputs also pulled back, with coking coal DJMcv1 and coke DCJcv1 on the Dalian exchange down 1.6% and 0.7%, respectively.
Rebar on the Shanghai Futures Exchange SRBcv1 edged up 0.2%, hot-rolled coil SHHCcv1 climbed 1%and wire rod SWRcv1 rose 0.4%. Stainless steel SHSScv1 fell 2.2%.