Black Friday is Now! Don’t miss out on up to 60% OFF InvestingProCLAIM SALE

UPDATE 1-China iron ore recoups losses amid supply concerns, stimulus hopes

Published 19/03/2020, 08:16 pm
© Reuters.
VALE3
-

* Dalian iron ore ends flat, but up 4.9% this year

* Vale may halt Malaysia distribution center ops

* Steel futures trim losses after crashing (Recasts, adds closing prices)

By Enrico Dela Cruz

MANILA, March 19 (Reuters) - China's iron ore futures erased earlier losses to end flat on Thursday, regaining support as miner Vale SA said it may temporarily halt activities at its Malaysian distribution center as a safety measure against the coronavirus pandemic.

Iron ore's most-traded contract on the Dalian Commodity Exchange DCIOcv1 steadied at 678 yuan ($95.76) a tonne, after tumbling 5.8% earlier in the session.

On the Singapore Exchange, the front-month iron ore contract trimmed losses to just 0.3% in afternoon trade from 4.1% earlier in the day.

Iron ore supplier Vale VALE3.SA said on Wednesday its Malaysian distribution center may halt operations between March 21-31 to safeguard employees and as authorities imposed transportation restrictions to contain coronavirus infections. miner, however, said its 2020 production and sales volumes would not be affected, despite an impact of about 800,000 tonnes in first-quarter sales.

Dalian iron ore is up 4.9% so far this year, displaying resilience despite panic gripping financial markets over the spreading coronavirus and its economic impact, as investors were hopeful of an infrastructure-led stimulus package from Beijing.

Steel futures also trimmed losses, although doubts remained over the effectiveness of further economic stimulus measures being rolled out across the world.

"Policymakers around the world are doing what they can, but it is unclear whether that is enough in economies that are likely to be in lockdown for an unknown number of months," Tapas Strickland, director of economics at National Australia Bank in Sydney, said in a note.

China accounts for more than half of the world's steel output and about half of total consumption of the manufacturing and construction material.

Beijing was hit by a record number of imported coronavirus infections while new local transmissions in China fell to zero, Thursday's data showed, putting more pressure on the capital to screen out sick passengers and isolate suspected cases. Construction steel rebar SRBcv1 on the Shanghai Futures Exchange crashed 6.5% before closing down 0.9%, while hot-rolled coil SHHCcv1 , used in cars and home appliances, and stainless steel SHSScv1 both shed 1.7%.

* Coking coal DJMcv1 was down 0.5% while coke DCJcv1 slumped 2.2%.

* Industry benchmark 62% iron ore's spot price stood at $92.50 a tonne on Wednesday, the highest since Feb. 24, based on data from SteelHome consultancy. SH-CCN-IRNOR62

($1 = 7.0801 yuan)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.