By Enrico Dela Cruz
Dalian iron ore sank deeper on Thursday, whereas benchmark costs of the steelmaking ingredient in Singapore hovered close to 2022 lows, hammered by a dismal outlook for international metal demand and supply-side pressures.
Steel costs in China, which accounts for about half the world’s output of the development and manufacturing materials, additionally fell amid a worsening COVID-19 state of affairs in Beijing.
The most-traded January iron ore on China’s Dalian Commodity Exchange ended morning commerce 2.5% decrease at 670.50 yuan ($92.58) a tonne, after touching its weakest since Sept. 5 at 670 yuan.
On the Singapore Exchange, the benchmark November iron ore contract was down 1.5% at $90.65 a tonne by 0348 GMT, close to its 2022 low of $90.30 hit on Tuesday.
The World Steel Association now expects a 2.3% contraction in international metal demand this yr, revising its forecast from a 0.4% development.
The Brussels-based group mentioned the worldwide financial surroundings has deteriorated considerably, citing excessive inflation and rate of interest hikes, and China’s slowdown as a result of its zero-COVID coverage and property sector downturn.
“The slump in the property market has deepened, with investment in real estate slowing to its worst in 30 years,” the group mentioned in a report on Wednesday.
“Despite the government’s efforts to boost the real estate market, a major turnaround is not expected since buyers’ confidence remains weak due to strict COVID-19 measures and developer bankruptcies.”
Supply-side pressures intensified.
This week main miners BHP Group and Vale SA reported larger quarterly iron ore manufacturing, whereas Rio Tinto posted a 4% quarter-on-quarter rise in shipments.
Rebar on the Shanghai Futures Exchange fell 1.2%, hot-rolled coil dipped 0.9%, wire rod shed 0.5%, whereas stainless-steel rose 1.6%.
Other steelmaking inputs additionally dropped, with Dalian coking coal and coke down 1.7% and a pair of.2%, respectively.
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Source: auto.economictimes.indiatimes.com