Fri Jan 20, 2012
* Shanghai rebar gains for 6th straight day
* Iron ore at two-week lows ahead of China holiday
* China manufacturing see sluggish start in 2012
SINGAPORE, Jan 20 (Reuters) - Shanghai steel futures edged up to three-month highs on Friday and are eyeing their biggest weekly gain since early December, supported by firmer equities, and these gains may revive buying interest in iron ore.The most-traded May rebar contract on the Shanghai Futures
Exchange was up 0.3 percent at 4,322 yuan a tonne by the midday break, after rising as high as 4,334 yuan earlier, its loftiest since Oct. 14.
The contract has gained 2.2 percent so far this week and Friday's gains were its sixth consecutive daily rise.Rebar's gains followed Asian equities, which touched two-month highs as easing concerns over Europe's refinancing capability boosted appetite for riskier assets. But sluggish data showing China's manufacturing sector was off to a shaky start in 2012 kept price gains in check.
The HSBC flash manufacturing purchasing managers index (PMI), the earliest indicator of China's industrial activity, stood at 48.8 in January, a three-month high and a slight improvement on the 48.7 final reading of the December index.
Spot iron ore prices slipped to two-week lows as trading in top market China ground to a halt ahead of the Lunar New Year holiday, but some traders are hopeful of a rebound when the Chinese buyers return after the week-long break. Any bounce may be limited though with market participants unsure whether China's steel demand will pick up strongly.
"People are counting on a possible rebound after Chinese New Year, but only because that's what's happened in the past years, not because they have any hard evidence," said Henry Liu, head of commodity research at Mirae Asset Securities in Hong Kong. "The best case scenario would be a small rebound."
Iron ore with 62 percent iron content .IO62-CNI=SI eased 0.1 percent to $139.70 a tonne on Thursday, the weakest since Jan. 4, according to Steel Index.
"Few traders are looking to make new purchases, and those with cargo in hand prefer to wait until after the holiday to make sales," Steel Index said.
Shanghai rebar futures and iron ore indexes at 0411 GMT
Contract Last Change Pct Change
SHANGHAI REBAR* 4322 12.00 0.28
PLATTS 62 PCT INDEX 140.75 -0.25 -0.18
THE STEEL INDEX 62 PCT INDEX 139.7 -0.20 -0.14
METAL BULLETIN INDEX 139.71 -0.25 -0.18
*In yuan/tonne
#Index in dollars/tonne, show close for the previous trading day
(sourced Reuters)
Showing posts with label Chinese steel industry. Show all posts
Showing posts with label Chinese steel industry. Show all posts
Friday, January 20, 2012
Wednesday, January 18, 2012
Iron Ore-Shanghai rebar hits 3-mth top on China data
Wednesday, 18 January 2012
China steel futures rose more than 1 percent to their highest in three months on Tuesday after data showed the world's second-largest economy grew at a faster pace than expected in the fourth quarter.
China's gross domestic product expanded an annual 8.9 percent in October-December, beating economists' forecasts for growth of 8.7 percent. But the pace was the weakest in 2-1/2 years and the economy looked headed for a sharper slowdown with export demand waning. The most-traded May rebar contract on the Shanghai Futures Exchange hit a high of 4,315 yuan a tonne, its loftiest since Oct. 17, tracking gains in other Shanghai-traded commodities. It closed 1.3 percent higher at 4,295 yuan.
With fourth-quarter GDP growth ahead of market expectations, it may be unlikely for China to aggressively ease monetary policy with its economy clearly staying brisk.
"Overall growth momentum continues to be strong. The slowdown is not scary, so we are not going to get massive policy easing," said Kevin Lai, economist at Daiwa in Hong Kong.Lai does not expect China to cut interest rates, but sees four more reductions in banks' reserve requirement ratio of 50 basis points each.Gains in steel prices should spur demand for iron ore although buying interest in the raw material may remain limited with trades winding down ahead of next week's Lunar New Year holiday, putting downward pressure on spot prices.
Iron ore with 62 percent iron content .IO62-CNI=SI fell 1.2 percent to $140.50 a tonne, cost and freight delivered to China, on Monday, according to the Steel Index.
FLAT RIO OUTPUT
"There's very little trading going on. A lot of our Chinese clients are already in holiday mode," said an iron ore trader in Singapore. But if Chinese steel prices extend gains after the week-long holiday, appetite for iron ore should pick up.
"Without any improvement in steel prices it'll be hard to see Chinese mills paying any more for iron ore, so it depends on the extent of the seasonal rebound in the steel market and Chinese macro policy," said a Shanghai-based trader. Iron ore prices usually move higher after the Chinese New Year break, and traders expect this year's bounce to be supported by expectations of further monetary policy relaxation in China where easing inflation puts authorities' focus back on boosting economic growth.
Australian miner Fortescue Metals said on Tuesday demand for its iron ore in China remained strong, encouraging it to expand output. Fortescue said its October-December iron ore shipments rose 19 percent from the previous quarter to 14.8 million tonnes.But bigger rival Rio Tinto reported a near-flat production growth of iron ore for the fourth quarter, weaker than some market expectations amid concerns that Chinese demand is softening.
Rio Tinto, the world's second biggest iron ore producer after Brazil's Vale, posted a 3 percent rise in output between the third and fourth quarters of 2011, down from growth of nearly double that at the end of 2010.China's crude steel output rose at a slower pace in 2011 as tighter credit dented consumption in the world's top steel market and growth is likely to even weaken this year with no clear outlook on demand.
The country's crude steel production rose 8.9 percent to 683.27 million tonnes last year, the National Bureau of Statistics said on Tuesday. While output was an all-time high, the increase was slower than the 9.3 percent rise in 2010.
sourced Reuters
China steel futures rose more than 1 percent to their highest in three months on Tuesday after data showed the world's second-largest economy grew at a faster pace than expected in the fourth quarter.
China's gross domestic product expanded an annual 8.9 percent in October-December, beating economists' forecasts for growth of 8.7 percent. But the pace was the weakest in 2-1/2 years and the economy looked headed for a sharper slowdown with export demand waning. The most-traded May rebar contract on the Shanghai Futures Exchange hit a high of 4,315 yuan a tonne, its loftiest since Oct. 17, tracking gains in other Shanghai-traded commodities. It closed 1.3 percent higher at 4,295 yuan.
With fourth-quarter GDP growth ahead of market expectations, it may be unlikely for China to aggressively ease monetary policy with its economy clearly staying brisk.
"Overall growth momentum continues to be strong. The slowdown is not scary, so we are not going to get massive policy easing," said Kevin Lai, economist at Daiwa in Hong Kong.Lai does not expect China to cut interest rates, but sees four more reductions in banks' reserve requirement ratio of 50 basis points each.Gains in steel prices should spur demand for iron ore although buying interest in the raw material may remain limited with trades winding down ahead of next week's Lunar New Year holiday, putting downward pressure on spot prices.
Iron ore with 62 percent iron content .IO62-CNI=SI fell 1.2 percent to $140.50 a tonne, cost and freight delivered to China, on Monday, according to the Steel Index.
FLAT RIO OUTPUT
"There's very little trading going on. A lot of our Chinese clients are already in holiday mode," said an iron ore trader in Singapore. But if Chinese steel prices extend gains after the week-long holiday, appetite for iron ore should pick up.
"Without any improvement in steel prices it'll be hard to see Chinese mills paying any more for iron ore, so it depends on the extent of the seasonal rebound in the steel market and Chinese macro policy," said a Shanghai-based trader. Iron ore prices usually move higher after the Chinese New Year break, and traders expect this year's bounce to be supported by expectations of further monetary policy relaxation in China where easing inflation puts authorities' focus back on boosting economic growth.
Australian miner Fortescue Metals said on Tuesday demand for its iron ore in China remained strong, encouraging it to expand output. Fortescue said its October-December iron ore shipments rose 19 percent from the previous quarter to 14.8 million tonnes.But bigger rival Rio Tinto reported a near-flat production growth of iron ore for the fourth quarter, weaker than some market expectations amid concerns that Chinese demand is softening.
Rio Tinto, the world's second biggest iron ore producer after Brazil's Vale, posted a 3 percent rise in output between the third and fourth quarters of 2011, down from growth of nearly double that at the end of 2010.China's crude steel output rose at a slower pace in 2011 as tighter credit dented consumption in the world's top steel market and growth is likely to even weaken this year with no clear outlook on demand.
The country's crude steel production rose 8.9 percent to 683.27 million tonnes last year, the National Bureau of Statistics said on Tuesday. While output was an all-time high, the increase was slower than the 9.3 percent rise in 2010.
sourced Reuters
Thursday, January 5, 2012
China 2011 steel output likely 683 million tons
Thu, Jan. 5, 2012
-- China's crude steel production likely reached 683 million tons in 2011
-- Country's 2012 crude steel demand may rise 4% to reach 700 million tons
-- Severe challenges ahead for China's steel exports, association says
BEIJING (MarketWatch) -- China's total crude steel output likely rose 9.2% in 2011 to 683 million metric tons, the China Iron and Steel Association said in a statement Thursday.
Steel exports likely rose 16% to 49 million tons. China's 2012 crude steel demand may rise around 4% to 700 million tons, it said.
However, many steelmakers in China are facing serious financing and capital difficulties, and some will have to halt or delay projects due to capital stress, CISA said.
The National Bureau of Statistics is expected to release steel output data later this month.
China faces "severe challenges" this year on the export front, and international trade frictions may arise, CISA said.
The association projected downside for iron ore prices due to sluggish global demand. "Chinese steelmakers are facing meager profit margins or losses this year," it said.
Import prices for iron ore averaged $166.2/ton in the first 11 months, up 31.5%.
In the first 11 months, CISA's member-mills gained a combined profit of CNY85.3 billion, up 8.1% but their profit margin was only 2.55% during the period, the association said.
(sourced MarketWatch)
-- China's crude steel production likely reached 683 million tons in 2011
-- Country's 2012 crude steel demand may rise 4% to reach 700 million tons
-- Severe challenges ahead for China's steel exports, association says
BEIJING (MarketWatch) -- China's total crude steel output likely rose 9.2% in 2011 to 683 million metric tons, the China Iron and Steel Association said in a statement Thursday.
Steel exports likely rose 16% to 49 million tons. China's 2012 crude steel demand may rise around 4% to 700 million tons, it said.
However, many steelmakers in China are facing serious financing and capital difficulties, and some will have to halt or delay projects due to capital stress, CISA said.
The National Bureau of Statistics is expected to release steel output data later this month.
China faces "severe challenges" this year on the export front, and international trade frictions may arise, CISA said.
The association projected downside for iron ore prices due to sluggish global demand. "Chinese steelmakers are facing meager profit margins or losses this year," it said.
Import prices for iron ore averaged $166.2/ton in the first 11 months, up 31.5%.
In the first 11 months, CISA's member-mills gained a combined profit of CNY85.3 billion, up 8.1% but their profit margin was only 2.55% during the period, the association said.
(sourced MarketWatch)
Wednesday, November 30, 2011
Iron Ore-Spot at 3-week low, Shanghai rebar slips
Wed Nov 30, 2011
* Iron ore has lost over 11 pct in 6 days
* Weaker steel demand limiting Chinese buying interest
SINGAPORE/SHANGHAI, Nov 30 (Reuters) - Offer prices for iron ore fell further on Wednesday as spot rates dropped to three-week lows with steelmakers in top producer China largely staying out of the market amid thin demand.
Iron ore with 62 percent iron content dropped 0.9 percent to $130.80 a tonne on Tuesday, said the Steel Index .IO62-CNI=SI, the lowest since Nov. 8. Iron ore has lost more than 11 percent in the last six consecutive trading days, trimming this month's gain to 10.5 percent. A 14-day rally earlier this month saw prices surging more than 26 percent after a slump in September and October.
"The buying activity from steel mills has been falling this week and I don't see any improvement in the iron ore market till the end of this year since demand for steel, particularly from the construction sector, is shrinking sharply," said an iron ore trader in Tangshan city in Hebei province, China's top steel producing region.
"The overall market is worried about the European debt crisis." The most-traded May rebar contract on the Shanghai Futures Exchange fell 1.2 percent to close at 4,075 yuan a tonne, more than wiping out Tuesday's gain and tracking weakness in other commodities spurred by the lack of bolder measures to resolve a two-year-old sovereign debt crisis in Europe.
Euro zone ministers agreed to ramp up the firepower of their rescue fund and may turn to the International Monetary Fund for more help as a stunning leap in Italy's borrowing costs pushed the region closer to financial disaster.
"The situation in Europe and the world has significantly worsened over the past few weeks. Market stress has intensified," said Christian Noyer, France's central bank governor and a governing council member of the European Central Bank.
"We are now looking at a true financial crisis -- that is a broad-based disruption in financial markets," he said at a conference in Singapore. Amid thin demand, sellers cut prices of iron ore cargoes further, with Australian Pilbara fines down a dollar to $131-$133 a tonne and Newman fines $2 lower at $135-$137 a tonne, said Chinese consultancy Umetal.
"Some traders are worried that iron ore prices will be very likely to fall further, so they have started selling more at lower prices," said an iron ore trader in China's eastern Shandong province. "But this isn't large-scale activity as the buying remains weak," he added.
But Steel Index said with spot steel and billet prices in China edging up this week, some mills in Hebei may return to the market next week to replenish their iron ore stockpiles.
(sourced Reuters)
* Iron ore has lost over 11 pct in 6 days
* Weaker steel demand limiting Chinese buying interest
SINGAPORE/SHANGHAI, Nov 30 (Reuters) - Offer prices for iron ore fell further on Wednesday as spot rates dropped to three-week lows with steelmakers in top producer China largely staying out of the market amid thin demand.
Iron ore with 62 percent iron content dropped 0.9 percent to $130.80 a tonne on Tuesday, said the Steel Index .IO62-CNI=SI, the lowest since Nov. 8. Iron ore has lost more than 11 percent in the last six consecutive trading days, trimming this month's gain to 10.5 percent. A 14-day rally earlier this month saw prices surging more than 26 percent after a slump in September and October.
"The buying activity from steel mills has been falling this week and I don't see any improvement in the iron ore market till the end of this year since demand for steel, particularly from the construction sector, is shrinking sharply," said an iron ore trader in Tangshan city in Hebei province, China's top steel producing region.
"The overall market is worried about the European debt crisis." The most-traded May rebar contract on the Shanghai Futures Exchange fell 1.2 percent to close at 4,075 yuan a tonne, more than wiping out Tuesday's gain and tracking weakness in other commodities spurred by the lack of bolder measures to resolve a two-year-old sovereign debt crisis in Europe.
Euro zone ministers agreed to ramp up the firepower of their rescue fund and may turn to the International Monetary Fund for more help as a stunning leap in Italy's borrowing costs pushed the region closer to financial disaster.
"The situation in Europe and the world has significantly worsened over the past few weeks. Market stress has intensified," said Christian Noyer, France's central bank governor and a governing council member of the European Central Bank.
"We are now looking at a true financial crisis -- that is a broad-based disruption in financial markets," he said at a conference in Singapore. Amid thin demand, sellers cut prices of iron ore cargoes further, with Australian Pilbara fines down a dollar to $131-$133 a tonne and Newman fines $2 lower at $135-$137 a tonne, said Chinese consultancy Umetal.
"Some traders are worried that iron ore prices will be very likely to fall further, so they have started selling more at lower prices," said an iron ore trader in China's eastern Shandong province. "But this isn't large-scale activity as the buying remains weak," he added.
But Steel Index said with spot steel and billet prices in China edging up this week, some mills in Hebei may return to the market next week to replenish their iron ore stockpiles.
(sourced Reuters)
Tuesday, November 29, 2011
China steel output to hold at below average levels - Mr Kloppers
Tuesday, 29 Nov 2011
BHP Billiton expects steel output in China to continue at current rates, below historical highs, for some time.
Mr Marius Kloppers CEO of BHPB said that "When we talk to our Chinese customers there is not a sentiment that the operating rate in the steel industry will improve or change dramatically over the next little while.”
Mr Kloppers also said that the company has no exposure to the euro, with all of the company's transactions settled in US dollars and its loans and bonds in US dollars.
(Sourced from Thomson Reuters)
BHP Billiton expects steel output in China to continue at current rates, below historical highs, for some time.
Mr Marius Kloppers CEO of BHPB said that "When we talk to our Chinese customers there is not a sentiment that the operating rate in the steel industry will improve or change dramatically over the next little while.”
Mr Kloppers also said that the company has no exposure to the euro, with all of the company's transactions settled in US dollars and its loans and bonds in US dollars.
(Sourced from Thomson Reuters)
Friday, November 11, 2011
Baosteel cuts HR and CR prices by USD 32 and USD 48 per tonne
Friday, 11 Nov 2011
China's Baoshan Iron & Steel will cut its main product prices for December bookings, a move reflecting the weakness in steel demand in the final month of 2011.
The company plans to slash hot-rolled coil prices by CNY 200 per tonne (USD 32) and cold rolled coil prices by CNY 300 per tonne (USD 48), after it kept its main steel product prices unchanged in November from October.
Baosteel pricing is often seen as a barometer of China's steel industry.
(Sourced from Reuters)
China's Baoshan Iron & Steel will cut its main product prices for December bookings, a move reflecting the weakness in steel demand in the final month of 2011.
The company plans to slash hot-rolled coil prices by CNY 200 per tonne (USD 32) and cold rolled coil prices by CNY 300 per tonne (USD 48), after it kept its main steel product prices unchanged in November from October.
Baosteel pricing is often seen as a barometer of China's steel industry.
(Sourced from Reuters)
Wednesday, October 26, 2011
China, Import prices of iron ore fall last week
Tue, Oct26, 2011 | Xinhua
BEIJING - Inventories of iron ore at 25 of China's major sea ports fell to 93.02 million tons in the week ending Oct 24, according to the Xinhua-China Iron Ore Price Index released on Tuesday.
The stock of imported iron ore last week was 50,000 tons lower than one week earlier, down 0.05 percent week-on-week, according to the index compiled by Xinhua News Agency to track iron ore inventories and imports on Chinese spot markets.
Prices of imported iron ore dropped last week. The price index for 63.5-percent-purity iron ore imports fell by 19 points to hit 148 points, while that for 58-percent-purity iron ore imports slid by 29 points to reach 109 points.
Xinhua analysts said import prices of iron ore have been on the downswing and market expectations of lower prices have strengthened.
Chinese steel companies tend to increase purchases of iron ore ahead of September and October, the traditional peak months for iron ore use.
China imported 42.54 million tons of iron ore during the first eight months of the year, a year-on-year increase of 10.5 percent, and 29.99 million tons more than the country's actual demand, according to data from the General Administration of Customs.
As most steel companies are fully stocked, they will slow purchases of the key industrial ingredients over the rest of the year, analysts said.
Global demand for iron ore will shrink in the short-term as the Chinese government intensifies its efforts to consolidate its steel industry to reduce overcapacity, and the United States and European countries remain mired in weak economic growth.
That will remove key supports from iron ore prices and put pressure on suppliers to lower prices, Xinhua analysts said.
(sourced ChinaDaily)
BEIJING - Inventories of iron ore at 25 of China's major sea ports fell to 93.02 million tons in the week ending Oct 24, according to the Xinhua-China Iron Ore Price Index released on Tuesday.
The stock of imported iron ore last week was 50,000 tons lower than one week earlier, down 0.05 percent week-on-week, according to the index compiled by Xinhua News Agency to track iron ore inventories and imports on Chinese spot markets.
Prices of imported iron ore dropped last week. The price index for 63.5-percent-purity iron ore imports fell by 19 points to hit 148 points, while that for 58-percent-purity iron ore imports slid by 29 points to reach 109 points.
Xinhua analysts said import prices of iron ore have been on the downswing and market expectations of lower prices have strengthened.
Chinese steel companies tend to increase purchases of iron ore ahead of September and October, the traditional peak months for iron ore use.
China imported 42.54 million tons of iron ore during the first eight months of the year, a year-on-year increase of 10.5 percent, and 29.99 million tons more than the country's actual demand, according to data from the General Administration of Customs.
As most steel companies are fully stocked, they will slow purchases of the key industrial ingredients over the rest of the year, analysts said.
Global demand for iron ore will shrink in the short-term as the Chinese government intensifies its efforts to consolidate its steel industry to reduce overcapacity, and the United States and European countries remain mired in weak economic growth.
That will remove key supports from iron ore prices and put pressure on suppliers to lower prices, Xinhua analysts said.
(sourced ChinaDaily)
Friday, October 21, 2011
China imported iron ore stocks up in wk ended Oct 21
Fri Oct 21, 2011
SHANGHAI, Oct 21 (Reuters) - Stockpiles of imported iron ore at major Chinese ports rose marginally this week to 92.22
million tonnes by Friday, after declining for five consecutive weeks in a row.
Shipments from Australia fell over the week, while those from Brazil and India rose slightly.
Following is a table showing iron ore port stock movements in the last seven days.
Country of Stockpiles Change (%)
origin (mln T)
Total 92.22 +0.05
Australia 39.95 -0.17
Brazil 21.98 +0.23
India 11.40 +0.80
Source: Mysteel
Sunday, September 11, 2011
China steel products output up 13 pct on yr - stats bureau
Sept11, 2011
SHANGHAI(Reuters) - China, the world's top steel-producing country, produced a total of 77 million tonnes of finished steel products in August, up 12.9 percent from a year earlier, data from the National Bureau of Statistics showed on Friday.
China produced 75.7 million tonnes of finished steel products in July. (sourced Reuters)
SHANGHAI(Reuters) - China, the world's top steel-producing country, produced a total of 77 million tonnes of finished steel products in August, up 12.9 percent from a year earlier, data from the National Bureau of Statistics showed on Friday.
China produced 75.7 million tonnes of finished steel products in July. (sourced Reuters)
Thursday, August 25, 2011
Hansteel to export 14,000 mt of cold rolled sheet to India
Wednesday, 24 August 2011
Handan Iron and Steel Group (Hansteel), a subsidiary of giant Chinese steelmaker Hebei Iron and Steel Group, has announced that in the current month it has received an order to export 14,000 mt of cold rolled sheet to India.
As of August 17, Hansteel had produced 2,800 mt of cold rolled sheet for the order in question.
Handan Iron and Steel Group (Hansteel), a subsidiary of giant Chinese steelmaker Hebei Iron and Steel Group, has announced that in the current month it has received an order to export 14,000 mt of cold rolled sheet to India.
As of August 17, Hansteel had produced 2,800 mt of cold rolled sheet for the order in question.
Iron Ore-Spot at 3-month top on brisk Chinese buying
Thu Aug 25, 2011
* High China steel output on brisk construction demand
* Chinese buying could wane if ore prices rise further
* Shanghai rebar slips to two-week low
By Manolo Serapio Jr
SINGAPORE, Aug 25 (Reuters) - Spot iron ore prices rose to their highest in more than three months and offers stayed firm on Thursday as Chinese mills restocked amid brisk steel demand.
Strong construction demand has been behind the rapid pace in China's daily steel production, which has averaged more than 1.9 million tonnes since late February, up from last year's 1.7 million tonnes.
But analysts and traders said the upturn in iron ore prices could lose steam if steel prices in China, the world's biggest consumer and producer, fall sharply.
"It looks like Chinese restocking is still underway, they still seem happy to buy iron ore. But they're probably at a point where they could pull out any minute," said Greme Train, commodity analyst at Macquarie in Shanghai.
"So if there's any negative news flow in the next couple of weeks, like weak PMI or another rate hike, then you could see a pullback in buying."
Two index-based spot prices hit their highest levels since mid-May, with 62-percent iron ore rising 0.3 percent to $180.25 a tonne on Wednesday, according to the Platts index IODBZ00-PLT. A similar grade at The Steel Index .IO62-CNI=SI rose 0.2 percent to $178.30.
Metal Bulletin's iron ore index .IO62-CNO=MB gained 0.3 percent to $178.31 a tonne, the highest since Aug. 4.
Offers for Indian 63.5/63 grade ore held at $187-$189 a tonne, cost and freight, on Thursday, said Chinese consultancy Umetal. Australian 62 percent Newman fines were quoted at $182-$184, it said.
Chinese buying appetite could wane if prices continue to rise, traders said.
"This bull run can't continue for too long. I see a price drop in September for sure," said a Shanghai-based iron ore trader.
A drop in Chinese steel futures to two-week lows on Thursday could prompt some mills to step back from buying the steelmaking ingredient.
The most-active January rebar contract on the Shanghai Futures Exchange fell as low as 4,788 yuan a tonne, before cutting losses to 4,806 yuan by 0317 GMT, down 0.3 percent.
But Macquarie's Train expects iron ore buying to intensify towards and into the fourth quarter when supply of domestic concentrates thins out as mining activity slows in winter.
"Risk reward is balanced at the moment in terms of where pricing can go from here, short-term, but at some point before the end of the year I think iron ore will probably be trading $10 higher than it is now."
(sourced Reuters)
* High China steel output on brisk construction demand
* Chinese buying could wane if ore prices rise further
* Shanghai rebar slips to two-week low
By Manolo Serapio Jr
SINGAPORE, Aug 25 (Reuters) - Spot iron ore prices rose to their highest in more than three months and offers stayed firm on Thursday as Chinese mills restocked amid brisk steel demand.
Strong construction demand has been behind the rapid pace in China's daily steel production, which has averaged more than 1.9 million tonnes since late February, up from last year's 1.7 million tonnes.
But analysts and traders said the upturn in iron ore prices could lose steam if steel prices in China, the world's biggest consumer and producer, fall sharply.
"It looks like Chinese restocking is still underway, they still seem happy to buy iron ore. But they're probably at a point where they could pull out any minute," said Greme Train, commodity analyst at Macquarie in Shanghai.
"So if there's any negative news flow in the next couple of weeks, like weak PMI or another rate hike, then you could see a pullback in buying."
Two index-based spot prices hit their highest levels since mid-May, with 62-percent iron ore rising 0.3 percent to $180.25 a tonne on Wednesday, according to the Platts index IODBZ00-PLT. A similar grade at The Steel Index .IO62-CNI=SI rose 0.2 percent to $178.30.
Metal Bulletin's iron ore index .IO62-CNO=MB gained 0.3 percent to $178.31 a tonne, the highest since Aug. 4.
Offers for Indian 63.5/63 grade ore held at $187-$189 a tonne, cost and freight, on Thursday, said Chinese consultancy Umetal. Australian 62 percent Newman fines were quoted at $182-$184, it said.
Chinese buying appetite could wane if prices continue to rise, traders said.
"This bull run can't continue for too long. I see a price drop in September for sure," said a Shanghai-based iron ore trader.
A drop in Chinese steel futures to two-week lows on Thursday could prompt some mills to step back from buying the steelmaking ingredient.
The most-active January rebar contract on the Shanghai Futures Exchange fell as low as 4,788 yuan a tonne, before cutting losses to 4,806 yuan by 0317 GMT, down 0.3 percent.
But Macquarie's Train expects iron ore buying to intensify towards and into the fourth quarter when supply of domestic concentrates thins out as mining activity slows in winter.
"Risk reward is balanced at the moment in terms of where pricing can go from here, short-term, but at some point before the end of the year I think iron ore will probably be trading $10 higher than it is now."
(sourced Reuters)
Wednesday, August 17, 2011
Iron Ore-Shanghai rebar gains for 5th day in six, ore rises
Wed Aug 17, 2011
* Chinese mills returning to iron ore market, lifting prices
* BHP sells Newman fines at $182.50/T vs $180.93 last week
* Rio Tinto halts operations at 2 mines after fatality (Updates rebar price)
By Manolo Serapio Jr
SINGAPORE, Aug 17 (Reuters) - Shanghai steel futures rose for a fifth time in six sessions on Wednesday, supported by hopes that demand from top consumer China will stay strong, boosting prices of raw material iron ore.
The most-active January rebar contract on the Shanghai Futures Exchange rose 0.6 percent to close at 4,863 yuan a tonne.
Firmer steel prices, buoyed by an active construction sector in China, encouraged Chinese mills to buy iron ore again this week after stepping back last week when global economic uncertainties weighed on equity and commodity markets.
More of China's leading steel mills have decided to raise prices of their main products for September bookings, following a similar move by top listed steelmaker Baoshan Iron & Steel Co Ltd last week on hopes of stronger demand next month.
"This week buyers have come back and there were a lot of inquiries, deals being done higher than last week," said a Shanghai-based iron ore trader.
BHP Billiton , the world's No. 3 iron ore miner, sold 63-percent grade Newman iron ore fines at $182.50 a tonne, cost and freight, at a tender late on Tuesday, up from $180.93 last week, traders said.
BHP also sold 58-percent grade Yandi fines at $159 a tonne, they said.
Separately, Indian 63.5/63 grade ore was sold to a Chinese steel mill at $186.50 a tonne this week, about a dollar higher from last week, said an iron ore trader in Singapore.
"This means end-user demand is there and they're ready to pay market prices or even slightly above market prices," said the Singapore-based trader, adding he is looking at the Indian grade to be offered at $188-$189 on Wednesday.
News that Rio Tinto , the world's second largest iron ore producer, has suspended operations at two mines in Australia following a fatality, should also support prices, traders said.
The two mines, Brockman 2 and Nammuldi, produce around 15 million tonnes of iron ore a year, about 6 percent of Rio's planned output of 240 million tonnes this year.
"This will be supportive of sentiment, but I don't think the disruption will be long, probably just a day or two," said another trader in Shanghai.
Increased buying in the physical market buoyed index-based reference prices which miners like Rio and BHP use in setting contract rates.
Iron ore with 62 percent iron content rose 30 cents to $176 a tonne on Tuesday, according to the Steel Index .IO62-CNI=SI.
A similar index by Platts IODBZ00-PLT edged up 50 cents to $178.50 and Metal Bulletin's own gauge .IO62-CNO=MB rose 49 cents to $176.78.
Prices of iron ore swaps extended recent gains, with nearly all contracts, from August 2011 to December 2013, cleared by the Singapore Exchange, rising, reflecting investor optimism spot prices can sustain their upward momentum.
"A lot depends on the macroeconomic environment. If the world collapses, China's steel prices should correct and this will have a negative effect on iron ore prices," said the Singapore trader.
"But if the world economy and stock markets remain stable, we expect a strong iron ore market to continue."
(sourced Reuters)
Monday, August 15, 2011
Iron Ore-Shanghai rebar extends gains to 4th day, to buoy ore
Mon Aug 15, 2011
* Shanghai rebar at 1-week top, mills may restock iron ore
* Baosteel price hike boosting steel demand outlook
By Manolo Serapio Jr
SINGAPORE, Aug 15 (Reuters) - Shanghai rebar futures rose for a fourth straight day on Monday to their highest in more than a week, spurred by expectations of firm demand in top consumer China.
Hopes that Chinese steel demand will stay strong ahead of the peak consumption season from mid-September should renew interest among mills to restock iron ore, the key steelmaking material, this week and boost prices that had dropped for most of last week.
The most-traded January rebar contract on the Shanghai Futures Exchange SRBc6 rose 0.9 percent to close at 4,854 yuan per tonne, just off its session-peak of 4,855 yuan, its highest since Aug. 5.
"Baosteel's move to increase prices was a good sign that steel demand will remain strong in September," said a trader in China's eastern Shandong province.
Baoshan Iron & Steel Co Ltd , China's biggest listed steelmaker, said on Friday it would raise prices of its main products for September, in anticipation that demand for flat steel products will pick up.
Unlike long steel products which had benefited from increased construction activity in China this year, makers of flat steel meant for automakers and producers of home appliances have seen margins squeezed by poor demand.
"There are expectations the central government may ease credit controls in the latter part of the year, which means steel mills can get more money from the banks," said a shipping manager for an iron ore trading firm in Shanghai.
"That's another reason behind the rise in steel prices, and if they continue to rise I believe steel mills would start to restock on iron ore this week."
China's monetary tightening campaign, in the form of interest rate hikes and increases in banks' reserve requirement ratio, has limited the amount of loans available to steel mills.
There was little appetite for iron ore last week as caution about the state of the global economy restrained buying.
Two key indexes, based on spot deals in China, fell for a fourth straight session on Friday to their lowest in about two weeks. The Steel Index's 62-percent benchmark .IO62-CNI=SI eased 20 cents to $175.90 a tonne and a similar index by Metal Bulletin .IO62-CNO=MB eased 7 cents to $176.23.
Global miner BHP Billiton sold 61.2-grade MAC iron ore fines at $173.93 a tonne, cost and freight, and 62.5-grade Newman fines at $180.93 a tonne, at a tender on Friday.
"I thought the prices were a bit more expensive than I had expected. But people probably feel that prices will go up again this week with steel prices rising," said the Shanghai shipping manager.
Indian ore with 63.5/63 percent iron content was offered at $183-$185 a tonne on Monday, steady from Friday, Chinese consultancy Umetal said.
Traders said there are unlikely to be fresh cargoes from Indian miners with India shut for a public holiday. ($1 = 6.389 yuan)
* Shanghai rebar at 1-week top, mills may restock iron ore
* Baosteel price hike boosting steel demand outlook
By Manolo Serapio Jr
SINGAPORE, Aug 15 (Reuters) - Shanghai rebar futures rose for a fourth straight day on Monday to their highest in more than a week, spurred by expectations of firm demand in top consumer China.
Hopes that Chinese steel demand will stay strong ahead of the peak consumption season from mid-September should renew interest among mills to restock iron ore, the key steelmaking material, this week and boost prices that had dropped for most of last week.
The most-traded January rebar contract on the Shanghai Futures Exchange SRBc6 rose 0.9 percent to close at 4,854 yuan per tonne, just off its session-peak of 4,855 yuan, its highest since Aug. 5.
"Baosteel's move to increase prices was a good sign that steel demand will remain strong in September," said a trader in China's eastern Shandong province.
Baoshan Iron & Steel Co Ltd , China's biggest listed steelmaker, said on Friday it would raise prices of its main products for September, in anticipation that demand for flat steel products will pick up.
Unlike long steel products which had benefited from increased construction activity in China this year, makers of flat steel meant for automakers and producers of home appliances have seen margins squeezed by poor demand.
"There are expectations the central government may ease credit controls in the latter part of the year, which means steel mills can get more money from the banks," said a shipping manager for an iron ore trading firm in Shanghai.
"That's another reason behind the rise in steel prices, and if they continue to rise I believe steel mills would start to restock on iron ore this week."
China's monetary tightening campaign, in the form of interest rate hikes and increases in banks' reserve requirement ratio, has limited the amount of loans available to steel mills.
There was little appetite for iron ore last week as caution about the state of the global economy restrained buying.
Two key indexes, based on spot deals in China, fell for a fourth straight session on Friday to their lowest in about two weeks. The Steel Index's 62-percent benchmark .IO62-CNI=SI eased 20 cents to $175.90 a tonne and a similar index by Metal Bulletin .IO62-CNO=MB eased 7 cents to $176.23.
Global miner BHP Billiton sold 61.2-grade MAC iron ore fines at $173.93 a tonne, cost and freight, and 62.5-grade Newman fines at $180.93 a tonne, at a tender on Friday.
"I thought the prices were a bit more expensive than I had expected. But people probably feel that prices will go up again this week with steel prices rising," said the Shanghai shipping manager.
Indian ore with 63.5/63 percent iron content was offered at $183-$185 a tonne on Monday, steady from Friday, Chinese consultancy Umetal said.
Traders said there are unlikely to be fresh cargoes from Indian miners with India shut for a public holiday. ($1 = 6.389 yuan)
Tuesday, July 19, 2011
Iron Ore-Spot prices, Shanghai rebar steady after gains
Tue Jul 19, 2011
* Optimism on China's steel demand intact
* Iron ore indexes flat to lower
By Manolo Serapio Jr
SINGAPORE/SHANGHAI, July 19 (Reuters) - Spot iron ore prices and Chinese steel futures steadied on Tuesday as buyers cast doubt on the sustainability of recent gains even as the long-term outlook remained upbeat.
Rebar futures in Shanghai have rebounded from three-month lows in June to hit their highest level since May on Monday on expectations China's drive to boost low-cost housing units will lift demand for construction steel in the second half of 2011.
"I am worried it's too early to be optimistic. The season for strong steel consumption hasn't come yet and the rise in steel prices does not seem solid amid tighter liquidity," said an iron ore trader in Shenzhen.
"Steel mills have built too much stocks over the past two weeks, so iron ore prices in the short term are still uncertain."
The most active October rebar contract on the Shanghai Futures Exchange was nearly flat at 4,906 yuan per tonne by 0530 GMT, after hitting a high of 4,915 yuan, near Monday's peak of 4,925 yuan.
Spot offers for iron ore were similarly steady, with Australian 62-grade Newman fines quoted at $179-$181 a tonne, including freight, and Indian 63.5/63 fines offered at $182-$184, said Chinese consultancy Umetal.
"I think the market's taking a breather. Iron ore prices have gone up too fast too soon and there has to be stronger evidence of steel consumption in China if people want to push prices further up," said an iron ore trader in Singapore.
Iron ore indexes, which track spot deals in China and which global miners use as benchmark to set quarterly contract prices, were flat to lower on Monday, after mostly rising since the start of July.
The Steel Index's 62-grade measure .IO62-CNI=SI eased 20 cents to $174.40 a tonne and a similar benchmark by Metal Bulletin .IO62-CNO=MB slipped 11 cents to $173.95.
Platts index IODBZ00-PLT was steady at $176.
But traders expect China, the world's No. 1 iron ore buyer, to continue buying more of the steelmaking raw material as mills look forward to increased steel demand from the government's social housing push and infrastructure investment.
"In the second half of this year, the overall iron ore import market should go well," said the Shenzhen trader.
China has imported 334.25 million tonnes of iron ore in January to June, up around 8 percent from a year ago, according to government data. If the current pace is sustained, imports are bound to hit a record near 670 million tonnes for the full year.
Gains in prices of forward swaps reflected optimism about Chinese demand, with Singapore Exchange-cleared contracts from July 2011 through December 2013 racing higher on Monday.
(By Reuters)
* Optimism on China's steel demand intact
* Iron ore indexes flat to lower
By Manolo Serapio Jr
SINGAPORE/SHANGHAI, July 19 (Reuters) - Spot iron ore prices and Chinese steel futures steadied on Tuesday as buyers cast doubt on the sustainability of recent gains even as the long-term outlook remained upbeat.
Rebar futures in Shanghai have rebounded from three-month lows in June to hit their highest level since May on Monday on expectations China's drive to boost low-cost housing units will lift demand for construction steel in the second half of 2011.
"I am worried it's too early to be optimistic. The season for strong steel consumption hasn't come yet and the rise in steel prices does not seem solid amid tighter liquidity," said an iron ore trader in Shenzhen.
"Steel mills have built too much stocks over the past two weeks, so iron ore prices in the short term are still uncertain."
The most active October rebar contract on the Shanghai Futures Exchange was nearly flat at 4,906 yuan per tonne by 0530 GMT, after hitting a high of 4,915 yuan, near Monday's peak of 4,925 yuan.
Spot offers for iron ore were similarly steady, with Australian 62-grade Newman fines quoted at $179-$181 a tonne, including freight, and Indian 63.5/63 fines offered at $182-$184, said Chinese consultancy Umetal.
"I think the market's taking a breather. Iron ore prices have gone up too fast too soon and there has to be stronger evidence of steel consumption in China if people want to push prices further up," said an iron ore trader in Singapore.
Iron ore indexes, which track spot deals in China and which global miners use as benchmark to set quarterly contract prices, were flat to lower on Monday, after mostly rising since the start of July.
The Steel Index's 62-grade measure .IO62-CNI=SI eased 20 cents to $174.40 a tonne and a similar benchmark by Metal Bulletin .IO62-CNO=MB slipped 11 cents to $173.95.
Platts index IODBZ00-PLT was steady at $176.
But traders expect China, the world's No. 1 iron ore buyer, to continue buying more of the steelmaking raw material as mills look forward to increased steel demand from the government's social housing push and infrastructure investment.
"In the second half of this year, the overall iron ore import market should go well," said the Shenzhen trader.
China has imported 334.25 million tonnes of iron ore in January to June, up around 8 percent from a year ago, according to government data. If the current pace is sustained, imports are bound to hit a record near 670 million tonnes for the full year.
Gains in prices of forward swaps reflected optimism about Chinese demand, with Singapore Exchange-cleared contracts from July 2011 through December 2013 racing higher on Monday.
(By Reuters)
Friday, May 20, 2011
China daily crude steel output at record high early May
Fri May 20, 2011 10:21am GMT
* Daily output at new record of 1.95 mln T
* Production over 1.9 mln T since early Feb
* Falling stockpiles point to healthy demand
By David Stanway and Ruby Lian
* Daily output at new record of 1.95 mln T
* Production over 1.9 mln T since early Feb
* Falling stockpiles point to healthy demand
By David Stanway and Ruby Lian
BEIJING/SHANGHAI, May 20 (Reuters) - Daily output of crude steel in China reached 1.9467 million tonnes in the first 10 days of May, with production at record levels despite worries about power shortages and the impact of Beijing's monetary tightening policies.
Industry consultancy Mysteel, citing data from the China Iron and Steel Association, said output was up 0.29 percent from May 1-10 compared with the previous 10 days.
Earlier CISA figures put daily output from April 21-30 at 1.941 million tonnes, with average production for the whole of April standing at a record 1.931 million tonnes.
Figures from the National Bureau of Statistics issued last week showed daily output in April at an even higher level of 1.968 million tonnes.
Despite grumbling from the China Iron and Steel Association and the country's industry ministry, China's steel mills have been producing around 1.9 million tonnes a day since the end of February, compared with about 1.7 million tonnes over 2010.
The second quarter is traditionally a strong season for steel and this year the sector has headed off a series of fresh problems, including the winding down of a state stimulus package and a tougher monetary regime that has reduced the amount of available credit.
Analysts predict output will stay near historical highs even in the face of power shortages and smelter closures as the quarter comes to an end.
"Steel production will very likely stay around 1.9 million tonnes on a daily basis over the course of this year, but especially in the second quarter," said Cai Peipei, an analyst with Tebon Securities.
GLUT OR NOT?
Daily output in April amounts to 718 million tonnes on an annualised basis, 15 percent higher than last year's total production.
CISA's secretary general Zhang Changfu told a news briefing at the end of April that overcapacity was eating into profit and that much of the blame could be placed on private mills. He said that overcapacity meant that steel prices could not rise to match the increases in raw material costs.
Steel product prices are currently close to record highs, with a tonne of rebar on the Shanghai spot market currently selling for 4,940 yuan ($759.4) per tonne, just short of the 5,000 yuan peak reached in mid-February, according to Mysteel.
Product stockpiles have been falling since the new year. Data from Mysteel put trader rebar stocks at 6.1 million tonnes at the end of April, compared with 7.7 million tonnes in early March.
Figures from the Ministry of Commerce show that construction steel stockpiles in 29 major cities fell 12 percent from March to April, ending the month at 8.56 million tonnes.
CISA's own figures for April also show an inventory decline of 13.83 percent compared with March. ($1 = 6.505 yuan) (Editing by Jacqueline Wong, sourced Thomson Reuters)
Industry consultancy Mysteel, citing data from the China Iron and Steel Association, said output was up 0.29 percent from May 1-10 compared with the previous 10 days.
Earlier CISA figures put daily output from April 21-30 at 1.941 million tonnes, with average production for the whole of April standing at a record 1.931 million tonnes.
Figures from the National Bureau of Statistics issued last week showed daily output in April at an even higher level of 1.968 million tonnes.
Despite grumbling from the China Iron and Steel Association and the country's industry ministry, China's steel mills have been producing around 1.9 million tonnes a day since the end of February, compared with about 1.7 million tonnes over 2010.
The second quarter is traditionally a strong season for steel and this year the sector has headed off a series of fresh problems, including the winding down of a state stimulus package and a tougher monetary regime that has reduced the amount of available credit.
Analysts predict output will stay near historical highs even in the face of power shortages and smelter closures as the quarter comes to an end.
"Steel production will very likely stay around 1.9 million tonnes on a daily basis over the course of this year, but especially in the second quarter," said Cai Peipei, an analyst with Tebon Securities.
GLUT OR NOT?
Daily output in April amounts to 718 million tonnes on an annualised basis, 15 percent higher than last year's total production.
CISA's secretary general Zhang Changfu told a news briefing at the end of April that overcapacity was eating into profit and that much of the blame could be placed on private mills. He said that overcapacity meant that steel prices could not rise to match the increases in raw material costs.
Steel product prices are currently close to record highs, with a tonne of rebar on the Shanghai spot market currently selling for 4,940 yuan ($759.4) per tonne, just short of the 5,000 yuan peak reached in mid-February, according to Mysteel.
Product stockpiles have been falling since the new year. Data from Mysteel put trader rebar stocks at 6.1 million tonnes at the end of April, compared with 7.7 million tonnes in early March.
Figures from the Ministry of Commerce show that construction steel stockpiles in 29 major cities fell 12 percent from March to April, ending the month at 8.56 million tonnes.
CISA's own figures for April also show an inventory decline of 13.83 percent compared with March. ($1 = 6.505 yuan) (Editing by Jacqueline Wong, sourced Thomson Reuters)
Wednesday, May 4, 2011
TATA Steel plans more investment in China
Wednesday, 04 May 2011
BOAO Hainan TATA Steel Limited, a subsidiary of TATA Steel Group, will increase investment in China by 5% in 2012 as it seeks to maintain market share according to the company's MD.
Mr Hemant Madhusudan Nerurkar told China Daily that the company will not make any major investments in its rolling mills located in the cities of Wuxi in Jiangsu province and Xiaman in Fujian province this year but next year there will be some changes.
Mr Nerurkar said that the company's problem in China is overcapacity which means production far exceeds real demand.
He added that “Capacity will gradually decline as the government encourages more energy efficiency in the industry. Infrastructure investment in China is still very high and there is still great demand for steel. As Chinese industry becomes more and more self sufficient in raw materials I'm sure it will turn out well."
Mr Nerurkar said rising demand for more value added products such as coated steels, electrical steels, and products for the aviation industry will provide opportunities for the company.
He said the Chinese steel industry has developed very well in the last 10 years at an admirable speed.
He also expects the company's business in China to grow at the same rate as the country's steel consumption growth by 5% to 7% increase year on year.
Mr Nerurkar said TATA Steel will continue to look for coking coal and iron ore assets for acquisition in areas such as Africa, Canada and Brazil to secure raw materials and counter fluctuating prices for coal and iron. The industry is facing severe price fluctuations and 70% of costs come from iron ore purchases, when he spoke at the Boao Forum for Asia in April.
He suggested that iron ore suppliers and steel companies should return to an annual pricing mechanism based on quarterly negotiations between the two sides to avoid frequent price fluctuations for raw materials based on quarterly negotiations between the two sides.
Mr Nerurkar said that in common with the rest of the steel industry, raw material prices will inevitably affect TATA Steel's profitability. (sourced Chinadaily)
Mr Hemant Madhusudan Nerurkar told China Daily that the company will not make any major investments in its rolling mills located in the cities of Wuxi in Jiangsu province and Xiaman in Fujian province this year but next year there will be some changes.
Mr Nerurkar said that the company's problem in China is overcapacity which means production far exceeds real demand.
He added that “Capacity will gradually decline as the government encourages more energy efficiency in the industry. Infrastructure investment in China is still very high and there is still great demand for steel. As Chinese industry becomes more and more self sufficient in raw materials I'm sure it will turn out well."
Mr Nerurkar said rising demand for more value added products such as coated steels, electrical steels, and products for the aviation industry will provide opportunities for the company.
He said the Chinese steel industry has developed very well in the last 10 years at an admirable speed.
He also expects the company's business in China to grow at the same rate as the country's steel consumption growth by 5% to 7% increase year on year.
Mr Nerurkar said TATA Steel will continue to look for coking coal and iron ore assets for acquisition in areas such as Africa, Canada and Brazil to secure raw materials and counter fluctuating prices for coal and iron. The industry is facing severe price fluctuations and 70% of costs come from iron ore purchases, when he spoke at the Boao Forum for Asia in April.
He suggested that iron ore suppliers and steel companies should return to an annual pricing mechanism based on quarterly negotiations between the two sides to avoid frequent price fluctuations for raw materials based on quarterly negotiations between the two sides.
Mr Nerurkar said that in common with the rest of the steel industry, raw material prices will inevitably affect TATA Steel's profitability. (sourced Chinadaily)
Monday, April 18, 2011
Iron Ore-Spot prices fall on slow China steel demand
Mon Apr 18, 2011 3:39am GMT
By Manolo Serapio Jr
SINGAPORE, April 18 (Reuters) - Spot prices of iron ore fell on Monday as a wobbly near-term outlook for steel demand in top consumer China kept steelmakers from buying more of the raw material.
Many Chinese steel mills had restocked iron ore ahead of an expected pickup in construction activity in the current quarter, but steel demand had so far been slow, prompting steelmakers to cut prices for May.
"Since last week, purchases were dropping," said an iron ore trader in Shenzhen. "Many mills already have bought a lot for stocks so they can wait for prices to drop before they buy again."
China's latest bank reserve hike on Sunday, the fourth this year, was expected to further tighten credit for steel producers and curb their capacity to buy raw materials, traders said.
Indian ore with 63.5 percent iron content was quoted at $186-$188 a tonne, including freight, on Monday, down from as much as $190 last week.
Iron ore indexes, based on China spot deals and which global miners use in computing supply contract prices, dropped on Friday.
Platts 62 percent iron ore index IODBZ00-PLT fell $1.75 to $181.25 a tonne and a similar benchmark by The Steel Index .IO62-CNI=SI slipped $1.80 to $181.50.
Metal Bulletin's 62 percent gauge .IO62-CNO=MB was off 47 cents at $180.67.
"Market participants are divided over where they see the market heading in the short term," The Steel Index said in a note. "Until clear direction is shown we expect to see prices oscillate a little."
Data on Friday showed China's daily crude steel output stood at 1.92 million tonnes in March, still near the record 1.94 million tonnes in February, as mills anticipated a recovery in demand.
If that production pace continues, Chinese buyers may soon pick up iron ore again, limiting any losses in spot prices.
"I don't see iron ore prices slumping in the near term as global commodity prices are still rising and China itself is also facing high inflation," said an iron ore trader in Beijing.
But price cuts for May by Chinese steelmakers suggest steel demand may not pick up soon.
Major Chinese steelmaker Angang was the latest to drop prices for main products for May bookings. Last week, pricing leader Baoshan Iron & Steel Co Ltd also announced a cut in May prices.
Outside China, Japanese steelmakers kept prices unchanged after last month's deadly earthquake and tsunami crippled production for many manufacturers, disrupted supply chains and delayed construction projects.
(Additional reporting by Ruby Lian in Shanghai;Editing by Clarence Fernandez, sourced Thomson Reuters)
By Manolo Serapio Jr
SINGAPORE, April 18 (Reuters) - Spot prices of iron ore fell on Monday as a wobbly near-term outlook for steel demand in top consumer China kept steelmakers from buying more of the raw material.
Many Chinese steel mills had restocked iron ore ahead of an expected pickup in construction activity in the current quarter, but steel demand had so far been slow, prompting steelmakers to cut prices for May.
"Since last week, purchases were dropping," said an iron ore trader in Shenzhen. "Many mills already have bought a lot for stocks so they can wait for prices to drop before they buy again."
China's latest bank reserve hike on Sunday, the fourth this year, was expected to further tighten credit for steel producers and curb their capacity to buy raw materials, traders said.
Indian ore with 63.5 percent iron content was quoted at $186-$188 a tonne, including freight, on Monday, down from as much as $190 last week.
Iron ore indexes, based on China spot deals and which global miners use in computing supply contract prices, dropped on Friday.
Platts 62 percent iron ore index IODBZ00-PLT fell $1.75 to $181.25 a tonne and a similar benchmark by The Steel Index .IO62-CNI=SI slipped $1.80 to $181.50.
Metal Bulletin's 62 percent gauge .IO62-CNO=MB was off 47 cents at $180.67.
"Market participants are divided over where they see the market heading in the short term," The Steel Index said in a note. "Until clear direction is shown we expect to see prices oscillate a little."
Data on Friday showed China's daily crude steel output stood at 1.92 million tonnes in March, still near the record 1.94 million tonnes in February, as mills anticipated a recovery in demand.
If that production pace continues, Chinese buyers may soon pick up iron ore again, limiting any losses in spot prices.
"I don't see iron ore prices slumping in the near term as global commodity prices are still rising and China itself is also facing high inflation," said an iron ore trader in Beijing.
But price cuts for May by Chinese steelmakers suggest steel demand may not pick up soon.
Major Chinese steelmaker Angang was the latest to drop prices for main products for May bookings. Last week, pricing leader Baoshan Iron & Steel Co Ltd also announced a cut in May prices.
Outside China, Japanese steelmakers kept prices unchanged after last month's deadly earthquake and tsunami crippled production for many manufacturers, disrupted supply chains and delayed construction projects.
(Additional reporting by Ruby Lian in Shanghai;Editing by Clarence Fernandez, sourced Thomson Reuters)
Friday, April 8, 2011
HK, China shares hit fresh 2011 highs, more gains seen
Fri Apr 8, 2011 9:30am GMT
* Rotational buying in telecoms, China Unicom outperforms
* Hang Seng seen testing Nov '10 peaks by early May
* Shanghai hits second consecutive 2011 high
By Yixin Chen and Clement Tan
SHANGHAI/HONG KONG, April 8 (Reuters) - Hong Kong and mainland stocks rose again on Friday, reaching fresh 2011 highs, and institutional investors are expected to keep increasing their exposure next week based on attractive valuations and demand for materials.
The benchmark Hang Seng Index recorded a third weekly gain as institutional investors have turned bullish following a favorable earnings season and signs of China inflation easing.
The Shanghai Composite Index closed up 0.7 percent on the day and 2.1 percent on the week to 3,030.0, a fresh 2011 high, keeping the index above the key 3,000-point level and extending the gain on the year to 7.8 percent.
The benchmark Hang Seng Index closed up 0.5 percent on the day and 2.8 percent on the week. During Friday's trading, it reached a new high for the year of 24,468.6 before dipping to close at 24,396.1.
The next target for the Hang Seng is 25,000 -- which was tested in November 2010.
"The Hang Seng will probably top last November's peak sometime end April or early May," said Li Kwok-Suen, a fund manager with Phillip Securities Ltd in Hong Kong. "Institutional investors will mainly drive this rally, with hedge funds giving it a lift."
In Hong Kong, China Unicom (Hong Kong) Ltd led gains on the benchmark, closing up 6.5 percent on volumes that were five times its Thursday level and 2.3 times its 30-day average. The stock ended the day technically overbought, with a relative strength index (RSI) value of 77.5.
Analysts said there was some rotational buying within the telecommunications sector on Friday, with investors buying Unicom and selling its more established peer, China Mobile Ltd , down 0.3 percent on the day.
Still, several analysts expect China Mobile and HSBC Holdings , which have strong weight in the benchmark, to lead a broad rally on the Hang Seng next week, but suggest that other big banks and resource stocks might support.
HSBC, up 1.0 percent on the day, is trading in Hong Kong at a 12-month forward price-to-earnings ratio of 10.7 times, below the 10-year average valuation of 13.1 times, Thomson Reuters I/B/E/S data showed. China Mobile is trading at 10.1 times, lower than its average valuation over the past decade of 12.6 times.
A slew of IPOs in the next few weeks will likely support a rally, thanks to foreign inflows, which have increased in the last three weeks, analysts said.
SBI Holdings is expected to debut on April 14 with Hui Xian, Cheung Kong's yuan-denominated real estate investment trust, expected to debut April 15.[ID:nTOE72600K]
In its quarterly report released on Thursday, HSBC Global Research shifted to overweight on Chinese equity markets for the first time in a year, while remaining neutral on Hong Kong.
Analysts at the bank cited the effectiveness of Chinese monetary policy on keeping inflation contained. M2 growth slowed to 15.7 percent year-on-year in February, lower than the 16 percent target the Chinese central bank has set for this year. The base effect also suggests inflation will slow in the second half of 2011, HSBC said.
SHANGHAI INVESTORS BUY STEEL
China's main stock index ended up 0.7 percent on Friday as investors bought selected stocks, such as steel companies, keeping the index hovering above the key 3,000-point level.
"Generally, the index did not fall sharply after interest rate hike," said Ju Zihua, an chief analyst AVIC Securities in Jiangxi province. "But, a cautious mood is still hovering around the market, and we still need to focus on some previous hot shares and blue chips."
He said non-ferrous metal, coal, brokerage and other blue chips were in focus.
Turnover in Shanghai fell to 147 million yuan ($22.4 million) from 152 billion yuan on Thursday, reflecting investors' worries about inflation and further tightening of monetary policy.
Almost all steel makers listed on the Shanghai and Shenzhen market rose as investors were upbeat that steel demand would be large in April following the earthquake in Japan.
Inner Mongolia Baotou Steel Union , the most active share, jumped its 10 percent daily limit, while Xining Special Steel Co rose 6.1 percent.
(Editing by Kevin Plumberg and Richard Borsuk, sourced Thomson Reuters)
* Rotational buying in telecoms, China Unicom outperforms
* Hang Seng seen testing Nov '10 peaks by early May
* Shanghai hits second consecutive 2011 high
By Yixin Chen and Clement Tan
SHANGHAI/HONG KONG, April 8 (Reuters) - Hong Kong and mainland stocks rose again on Friday, reaching fresh 2011 highs, and institutional investors are expected to keep increasing their exposure next week based on attractive valuations and demand for materials.
The benchmark Hang Seng Index recorded a third weekly gain as institutional investors have turned bullish following a favorable earnings season and signs of China inflation easing.
The Shanghai Composite Index closed up 0.7 percent on the day and 2.1 percent on the week to 3,030.0, a fresh 2011 high, keeping the index above the key 3,000-point level and extending the gain on the year to 7.8 percent.
The benchmark Hang Seng Index closed up 0.5 percent on the day and 2.8 percent on the week. During Friday's trading, it reached a new high for the year of 24,468.6 before dipping to close at 24,396.1.
The next target for the Hang Seng is 25,000 -- which was tested in November 2010.
"The Hang Seng will probably top last November's peak sometime end April or early May," said Li Kwok-Suen, a fund manager with Phillip Securities Ltd in Hong Kong. "Institutional investors will mainly drive this rally, with hedge funds giving it a lift."
In Hong Kong, China Unicom (Hong Kong) Ltd led gains on the benchmark, closing up 6.5 percent on volumes that were five times its Thursday level and 2.3 times its 30-day average. The stock ended the day technically overbought, with a relative strength index (RSI) value of 77.5.
Analysts said there was some rotational buying within the telecommunications sector on Friday, with investors buying Unicom and selling its more established peer, China Mobile Ltd , down 0.3 percent on the day.
Still, several analysts expect China Mobile and HSBC Holdings , which have strong weight in the benchmark, to lead a broad rally on the Hang Seng next week, but suggest that other big banks and resource stocks might support.
HSBC, up 1.0 percent on the day, is trading in Hong Kong at a 12-month forward price-to-earnings ratio of 10.7 times, below the 10-year average valuation of 13.1 times, Thomson Reuters I/B/E/S data showed. China Mobile is trading at 10.1 times, lower than its average valuation over the past decade of 12.6 times.
A slew of IPOs in the next few weeks will likely support a rally, thanks to foreign inflows, which have increased in the last three weeks, analysts said.
SBI Holdings is expected to debut on April 14 with Hui Xian, Cheung Kong's yuan-denominated real estate investment trust, expected to debut April 15.[ID:nTOE72600K]
In its quarterly report released on Thursday, HSBC Global Research shifted to overweight on Chinese equity markets for the first time in a year, while remaining neutral on Hong Kong.
Analysts at the bank cited the effectiveness of Chinese monetary policy on keeping inflation contained. M2 growth slowed to 15.7 percent year-on-year in February, lower than the 16 percent target the Chinese central bank has set for this year. The base effect also suggests inflation will slow in the second half of 2011, HSBC said.
SHANGHAI INVESTORS BUY STEEL
China's main stock index ended up 0.7 percent on Friday as investors bought selected stocks, such as steel companies, keeping the index hovering above the key 3,000-point level.
"Generally, the index did not fall sharply after interest rate hike," said Ju Zihua, an chief analyst AVIC Securities in Jiangxi province. "But, a cautious mood is still hovering around the market, and we still need to focus on some previous hot shares and blue chips."
He said non-ferrous metal, coal, brokerage and other blue chips were in focus.
Turnover in Shanghai fell to 147 million yuan ($22.4 million) from 152 billion yuan on Thursday, reflecting investors' worries about inflation and further tightening of monetary policy.
Almost all steel makers listed on the Shanghai and Shenzhen market rose as investors were upbeat that steel demand would be large in April following the earthquake in Japan.
Inner Mongolia Baotou Steel Union , the most active share, jumped its 10 percent daily limit, while Xining Special Steel Co rose 6.1 percent.
(Editing by Kevin Plumberg and Richard Borsuk, sourced Thomson Reuters)
Wednesday, April 6, 2011
China's Wuhan to explore for iron in Madagascar
Wed Apr 6, 2011 9:13am GMT
* Exploration to take 6-8 months
* WISCO paid $100 million for exploration permit
ANTANANARIVO, April 6 (Reuters) - Wuhan Iron & Steel Co (WISCO), China's third-largest steelmaker, plans to start exploratory drilling for iron ore in Madagascar's Soalala region at the end of May, officials said.
WISCO Madagascar -- one of many foreign firms keen to develop the Indian Ocean island's mineral resources -- paid $100 million for exploration permits in 2010.
"Our investments are made in stages, depending on the results of the survey. The investment decision is expected in six to eight months, then will come the construction phase, which will last four years," said WISCO Madagascar's chief executive, Jun Yuan Lou.
"The actual operation should start in five years," he told a news conference late on Tuesday, when signing an environmental impact study and exploratory drilling agreement with the National Environment Office (ONE).
Exploration in Madagascar, which has oil, cobalt, nickel, gold and uranium deposits, has been hampered by a political crisis since incumbent President Andry Rajoelina seized power in March 2009.
As this project proceeds, "Environmental assessment studies, including the various public consultations will begin this week," said ONE's chief executive, Jean Chrysostome Rakotoary.
An environmental permit will be issued at the conclusion of the studies, which will take at least 45 days, and after the company pays ONE $350,000, he said.
The island's political crisis forced Madagascar Oil last month to declare force majeure on four of its oil blocks to safeguard its exploration rights after failing to reverse a state directive to acquire them. (Reporting by Alain Iloniaina; Editing by Helen Nyambura and Jane Baird)
* Exploration to take 6-8 months
* WISCO paid $100 million for exploration permit
ANTANANARIVO, April 6 (Reuters) - Wuhan Iron & Steel Co (WISCO), China's third-largest steelmaker, plans to start exploratory drilling for iron ore in Madagascar's Soalala region at the end of May, officials said.
WISCO Madagascar -- one of many foreign firms keen to develop the Indian Ocean island's mineral resources -- paid $100 million for exploration permits in 2010.
"Our investments are made in stages, depending on the results of the survey. The investment decision is expected in six to eight months, then will come the construction phase, which will last four years," said WISCO Madagascar's chief executive, Jun Yuan Lou.
"The actual operation should start in five years," he told a news conference late on Tuesday, when signing an environmental impact study and exploratory drilling agreement with the National Environment Office (ONE).
Exploration in Madagascar, which has oil, cobalt, nickel, gold and uranium deposits, has been hampered by a political crisis since incumbent President Andry Rajoelina seized power in March 2009.
As this project proceeds, "Environmental assessment studies, including the various public consultations will begin this week," said ONE's chief executive, Jean Chrysostome Rakotoary.
An environmental permit will be issued at the conclusion of the studies, which will take at least 45 days, and after the company pays ONE $350,000, he said.
The island's political crisis forced Madagascar Oil last month to declare force majeure on four of its oil blocks to safeguard its exploration rights after failing to reverse a state directive to acquire them. (Reporting by Alain Iloniaina; Editing by Helen Nyambura and Jane Baird)
Monday, March 14, 2011
Wuyang Steel exports 18000 tonnes of steel plate in February
Monday, 14 Mar 2011
It is reported that Hebei Province based Chinese steelmaker Wuyang Iron and Steel Co Ltd exported 18,000 tonnes of steel plate in February this year marking its best monthly export performance since the outbreak of the financial crisis.
Wuyang Steel mainly exports boiler plate, container plate, thick Z-plate and offshore platform steel plate to be used in hydroelectric and wind power projects in South America as well as in oil storage tank manufacturing in the Gulf region. In addition, Wuyang Steel also exports its steel plates to countries such as South Korea, Vietnam and Iran.
In H1 2010 Wuyang Steel exported 92,000 tonnes of wide and thick plate, almost equal to the company total export volume for the whole of 2009.
It is reported that Hebei Province based Chinese steelmaker Wuyang Iron and Steel Co Ltd exported 18,000 tonnes of steel plate in February this year marking its best monthly export performance since the outbreak of the financial crisis.
Wuyang Steel mainly exports boiler plate, container plate, thick Z-plate and offshore platform steel plate to be used in hydroelectric and wind power projects in South America as well as in oil storage tank manufacturing in the Gulf region. In addition, Wuyang Steel also exports its steel plates to countries such as South Korea, Vietnam and Iran.
In H1 2010 Wuyang Steel exported 92,000 tonnes of wide and thick plate, almost equal to the company total export volume for the whole of 2009.
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