Iron-ore firms on China pre-holiday restocking, demand uncertainty caps gains
Iron-ore prices rose for a second session on Thursday, as Chinese steelmakers stepped up seaborne purchases ahead of a national holiday, although shrinking steel mill margins clouded the demand outlook.
The most-traded iron-ore contract on China's Dalian Commodity Exchange (DCE) rose 0.35% to 711 yuan ($105.94) a ton, as of 01:47 GMT.The benchmark October iron-ore on the Singapore Exchange was 0.26% higher at $96.05 a ton, as of 01:37 GMT, hovering below the key psychological level of $100 for six straight sessions.
Several steelmakers booked seaborne cargoes for the upcoming week-long National Day holiday break over October 1-7.
The daily transaction volume of seaborne cargoes jumped by 43% to 1.41-million tons on Wednesday from the day before, data from consultancy Mysteel showed.
However, mills may slow their restocking as tumbling margins discouraged mills from ramping up output, curbing price upside, said analysts.
Other steelmaking ingredients also gained ground, with coking coal and coke up 1.18% and 1.31%, respectively. Steel benchmarks on the Shanghai Futures Exchange advanced. Rebar added 0.1%, hot-rolled coil ticked up 0.24%, and stainless steel jumped 0.78%.
"The real steel demand has not shown clear signs of recovering, missing earlier expectations, but supply contraction persisted as losses exacerbated," analysts at broker Zhengxin Futures said in a note.
