by Chris Becker
The iron ore complex slumped yesterday for the second straight session as falling car sales took the bite out of the supply crunch:
More from Reuters:
China is likely to see a further drop in vehicle sales this year compared to expectations for zero growth, the country’s biggest auto industry association said on Wednesday, after its data showed the sector contracted for a 12th straight month in June.
“Steel demand particularly in the construction sector has slowed down a bit as some real estate developers face financing issues at home,” said a Shanghai-based trader.
“But they are trying to solve this problem by trying to raise more funds at the overseas markets,” the trader added.
Chinese steel futures and prices for steelmaking inputs such as iron ore have risen this year partly due to expectations that Beijing will provide more stimulus to avoid a sharper economic slowdown.The trader said any additional stimulus could be expected after the National Day holiday in October. “Usually nothing big happens before that,” he added.
China’s economic growth is expected to slow to a near 30-year low of 6.2% this year, a Reuters poll showed on Wednesday, despite a flurry of support measures to spur domestic demand amid a bruising trade war with the United States.