China iron ore, steel steady after rapid rally
Source: www.chinamining.org Citation: reuters.com Date: February 16, 2017
Chinese iron ore and steel futures stabilized on Thursday after recent sharp gains that pushed the steelmaking raw material to a record high.
Expectations of a pickup in construction activity and steel supply tightening in China, the world`s largest producer, have helped steel prices rally this year, fueling a rapid rise in iron ore markets.
The most-active rebar on the Shanghai Futures Exchange was up 0.6 percent at 3,432 yuan ($501) a tonne by 0303 GMT. The construction steel product reached a two-month high of 3,458 yuan on Wednesday.
Iron ore on the Dalian Commodity Exchange was flat at 703 yuan per tonne, after peaking at 718 yuan in the prior session, matching its highest intraday level touched in October 2013, when the exchange launched iron ore futures.
Rebar has gained 18 percent so far this year and iron ore has risen 27 percent.
To improve air quality during the annual meeting of the National People`s Congress in early March, governments in Beijing, Tianjin and Hebei have released orders for steel mills to cap production from late February to early March, Chinese commodities firm Xiben New Line reported.
The Beijing-Tianjin-Hebei region produced around 210 million tonnes of crude steel last year, or 26 percent of China`s total output, analysts at Morgan Stanley said in a note.
If half of steel production in the region is capped for 20 days, the decline in production could be 5.8 million tonnes, they said.
"In this case, it may create short-term supply tightness and hence price reactions, as demand recovers starting from late February," they said.
"(But) overall, we expect the potential impact to be short-lived."
Iron ore for delivery to China`s Qingdao port dropped 0.7 percent to $91.05 a tonne on Wednesday, according to Metal Bulletin.
It was the second straight day of decline for the spot benchmark after touching a 30-month peak of $92.23 on Monday. ($1 = 6.8577 Chinese yuan)
About CHINA MINING
Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.
CHINA MINING Congress and Expo 2017 will be held at Meijiang Convention and Exhibition Center in Tianjin China in September23-25, 2017. We invite you to join the event and to celebrate the 19th anniversary of CHINA MINING with us. For more information about CHINA MINING 2017, please visit: www.chinaminingtj.org.
