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UPDATE 1-China steel futures fall on consumption concerns

Published 21/10/2019, 06:45 pm
© Reuters.  UPDATE 1-China steel futures fall on consumption concerns
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* Dalian iron ore rose as much as 1.7%

* Spot prices for benchmark 62% Fe stood at $86.50 a tonne

* Steel consumption is expected to slow - analyst

(Adds details, quotes; Update closing prices)

BEIJING, Oct 21 (Reuters) - Chinese steel futures declined for a second session on Monday, pressured by expectations for slowing consumption and as robust output from mills added to supply of the metal.

The most-active construction steel rebar contract on the Shanghai Futures Exchange (ShFE) SRBcv1 , for January delivery, ended down 0.09% at 3,290 yuan ($465.06) a tonne on Monday.

ShFE futures for hot-rolled coil SHHCcv1 , used in cars and home appliances, edged down 0.03% at 3,285 yuan per tonne.

Singapore-based steel and iron ore data analytics firm Tivlon Technologies expects steel consumption to cool with the coming of November, when construction slows down with the approach of colder weather during the Northern Hemisphere winter.

"But steel supply seems pretty robust as mills as using more direct charge material like lumps and pellets to maintain production, despite the sintering cuts," said Darren Toh, data scientist with Tivlon.

A sintering plant uses heat to process iron ore ahead of smelting into steel.

The most-traded iron ore on the Dalian Commodity Exchange DCIOcv1 , for January 2020 delivery, rose 0.41% to 612 yuan a tonne.

The inventory of imported iron ore at Chinese port SH-TOT-IRONINV grew to 131.10 million tonnes as of Sept.18, the highest level in five months.

"We believe the main drag on iron ore import demand will arise from pressures on profitability of steel producers in China," Fitch Solutions said in a report released on Friday.

FUNDAMENTALS

* Benchmark 62% iron ore for delivery to China SH-CCN-IRNOR62 was at $86.50 a tonne on Friday, flat from the day earlier.

* The front-month February 2020 stainless steel futures contract SHSSc1 fell 1.20% to 14,850 yuan a tonne.

* Other steelmaking ingredients were mixed, with Dalian coking coal futures DJMcv1 rising 0.37% to 1,237 yuan a tonne while Dalian coke futures DCJcv1 dropped 1.47% to 1,743 yuan a tonne.

* China's state planner approved fourteen fixed-asset projects worth 177.8 billion yuan in September, compared with a 68.9 billion yuan worth of approved projects in August. China's new home prices rose 0.5% in September on month, in line with August's growth and marked the 53rd straight month of gains. Mitsubishi Corp 8058.T sold its iron ore expansion and rail and port infrastructure project in Western Australia to China's state-owned Sinosteel, the Japanese conglomerate said on Monday. For the top stories of metals and other news, click TOP/MTL or MET/L

($1 = 7.0744 Chinese yuan renminbi)

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