Here are the iron ore charts for March 12, 2015:
All green! Tianjin spot also managed 20 cents to finish at $57.90. Dalian kept rallying overnight and is now at 465 ($59). Most encouraging was rebar average which jumped.
On what, you ask? Presumably hopes of more stimulus after Wednesday’s awful growth figures, which rather suggests it won’t last long!
Reuters has texture:
“Construction activities typically kick off widely after the National People’s Congress, and we are almost there, which will lift steel demand,” said Hu Xiaodong, an analyst at Nanhua Futures in Hangzhou. The annual parliament takes place between March 3 and March 15 this year.
Meh, don’t but it. Steel stocks are high (though low at traders but that is a structural change) so there’s no reason to expect a sudden surge in production. CISA makes more sense from Platts:
The China Iron & Steel Association, or CISA, said Thursday that iron ore import prices may hit a new low in March amid sluggish demand from Chinese mills and rising supply from major miners.
“More negative than positive factors are looming over the iron ore market, such as that demand from Chinese steel mills may decline further in March as they may be forced to halt operating some furnaces due to tightening pollution control in the country,” CISA said in its monthly iron ore market analysis.
Supply from the world’s top four miners, however, would increase with their ongoing expansions, it added.
Chinese mills may feel slight easing in financing thanks to the government’s loosening its monetary policy earlier this year, but oversupply in the fundamental iron ore market is unlikely to solve in short time, all of which will drag down iron ore prices, CISA concluded.
A temporary reprieve.
