| Chinese steel futures edged up
0.6 percent to two-week highs on Thursday in a technical bounce after
recent losses, but a second straight month of decline for prices in June
clouds the outlook for demand in the third quarter.
A lull in steel demand in top consumer
China has weighed on spot iron ore prices .IO62-CNI=SI which fell to their
lowest in more than three months on Wednesday and are also bound for a
second consecutive month of losses.
The most-active October rebar contract on
the Shanghai Futures Exchange rose 27 yuan to close at 4,753 yuan a tonne.
Despite the gain, Shanghai rebar fell 2.5 percent for all of June, more
than three times its losses in May.
"It's a modest rebound, there's
nothing much else to it. Actual physical trading of steel and iron ore
remains thin," said a Shanghai-based trader.
BHP Billiton sold around 100,000 tonnes of
63-grade Newman iron ore fines at $174, cost and freight at a tender on
Wednesday, traders said. The world's No. 3 iron ore miner also sold
80,000-90,000 tonnes of 57.7-grade Yandi fines at $152.50 a tonne,
C&F, they said.
"The prices are more or less within
market expectations. We believe prices will continue to fall in a slow
pace because of weak Chinese demand," said an iron ore trader in
Beijing.
"Besides the BHP tender, we didn't
hear of any other deals for iron ore."
Global miners like BHP and Rio Tinto
Iron ore indexes, which track spot
transactions in China and which global miners use as basis in setting
contract prices, fell on Wednesday to levels not seen since late March.
The Steel Index's 62 percent iron ore
benchmark .IO62-CNI=SI fell 1 percent to $166.80 a tonne, its lowest since
March 25. Metal Bulletin's similar gauge .IO62-CNO=MB eased 2 cents to
$167.00, its weakest since March 28.
Both indexes are down around 2 percent this
month, on track for a second straight month of losses.
Platts index IODBZ00-PLT slipped 0.4
percent to $170.75. |
