Benchmark Iron Ore Prices Rises in the Asia Pacific as Demand for Steel Products in China is Likely to Rebound
As demand for steel products in china is likely to rebound, therefore the benchmark iron ore prices increased in the Asia Pacific. The prices of iron ore in Singapore jumped on September 27, 2022, after failing for two straight sessions as China, the world’s largest producer of steel, continued increasing output to benefit from the peak construction session in September 2022 and October 2022.
Prices for iron ore cargoes with a 63.5% iron content for delivery into Tianjin were USD 99.5 per tonne, staying above the 10-month low of USD 98 reached on September 21, 2022, as low steel inventories could increase demand for inputs by blast furnaces as stimulus measures aim to support construction and manufacturing activity in China.
On the Singapore exchange, benchmark October iron ore increased by 1.5 percent to a session high of USD 97.05 per tonne, while the September 2022 contract increased by 0.2 percent to USD 98.60. The most active January iron ore contract on China’s Dalian Commodity exchange finished its daytime trading 1.1 percent higher at 718.50 yuan per tonne.
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Chinese steel mills have increased output this month, with their average daily crude steel output reaching a three-month high of USD 2.89 million tonnes.
Rebar output increased by 26,700 tonnes from the previous week to about USD 3.1 million tonnes among the 137 Chinese steel factories included in the weekly pool by industry information supplier and consultant Mysteel.
Prior to China’s week-long national holiday beginning on October 01, 2022, the steel mills are refilling their iron ore supplies. The market gains on September 27, 2022, showed that it still has some faith in the improvement of Chinese steel production and demand continuing into September 2022 and October 2022.
According to data from the China Iron and Steel Association, the average daily output of crude steel from the large steel mills climbed by 2.23 percent in mid-September 2022 compared to early September 2022 as the sectors were prepared for peak construction. On the Shanghai Futures Exchange, rebar increased by 2.5 percent to reach its highest price per tonne since August 29, 2022, at USD 540.33 (3,845 yuan). Stainless steel increased by 0.3 percent, although hot rolled coil climbed by 2.3 percent.
Coking coal and coke from Dalian both increased in price, by 2.9 percent and 2.7 percent respectively. Traders neglected statistics suggesting that between January 2022 and August 2022, because of harsh COVID-19 regulations and worsening real estate recessions, profits at China’s industrial enterprises declined.
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As per Procurement Resource, the benchmark iron ore prices surged in the Asia Pacific, as the demand for steel goods is projected to rebound. September 2022 saw a rise in production at Chinese steel mills, with their average daily crude steel output reaching a three-month high of USD 2.89 million tonnes. In mid-September 2022, the large steel mills' average daily output of crude steel increased by 2.23 percent, according to data from the China Iron and Steel Association.