July 14, 2020 / 3:00 AM / 25 days ago

Dalian iron ore futures extend gains amid demand optimism

FILE PHOTO: Workers pour molten iron into a mould at a workshop in Hangzhou, Jiangsu province, China July 24, 2019. REUTERS/Stringer

BEIJING (Reuters) - China’s iron ore futures rose for a second straight session on Tuesday amid positive market sentiment about a swift economic recovery and hopes of further demand after the rainy season.

The most-traded iron ore futures on the Dalian Commodity Exchange DCIOcv1, for September delivery, rose 1.7% to 833 yuan (£94.70) per tonne by 0215 GMT.

“The surge in iron ore futures prices comes as (there are) no significant demand and supply contradictions,” Huatai Futures wrote in a note.

“It’s more (driven by) market sentiment and in preparation for the peak season,” it said, adding that current utilisation rates at blast furnaces remained at high levels.

Spot prices for iron ore with 62% iron content for delivery to China, compiled by SteelHome consultancy, rose by $2.5 to $109.5 per tonne on Monday from the previous trading day.

Customs data showed China’s iron ore imports in January-June rose 9.6% to 547 million tonnes from a year earlier.

Steel prices on the Shanghai Futures Exchange were range-bound. The most-traded October contract of rebar, used in the construction sector, SRBcv1 dipped 0.1% to 3,730 yuan a tonne and hot-rolled coils SHHCcv1 - materials for the manufacturing sector - fell 0.2% to 3,735 yuan per tonne.

Stainless steel futures, for September delivery SHSScv1, inched up 0.2% to 13,610 yuan a tonne.

Reporting by Min Zhang and Tom Daly; Editing by Subhranshu Sahu

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