Top miners raise iron ore supplies, drag prices down
Home prices in China inched up 0.05% last month from September, according to a Reuters calculation, based on official data released this week, despite the government's efforts to temper rates.
Moreover, steel consumption has remained fundamentally weak in China and the appetite of many mills has already been satiated with the recent stocking up, the traders added. This means iron ore prices may remain subdued again unless China agressively pushes infrastructure.
The benchmark 62% iron ore price has jumped 41% since hitting a three-year low of $86.7 a tonne on September 5, but the slow pace of demand from Chinese mills has capped gains at just above $120.
After briefly hitting a fresh seven-week low of 3,539 yuan, Shanghai steel rebar futures settled up 0.2% at 3,552 yuan ($570) a tonne on Tuesday. The commodity dropped nearly 3% in the previous session.
China's average daily crude steel production inched up 1.6% to 1.95 million tonnes for the first 10 days of this month from the preceding period, as mills pushed up output on a recent rally in steel prices from September lows.
However, traders say, given the gloomy growth outlook across the US and Europe, iron ore may pare down some gains if China maintain status quo in policy-making.
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