Chinese stainless steel futures jumped to their highest in more than three months on Wednesday, boosted by high input costs and optimism over demand, while iron ore remained pressured by Beijing's sustained efforts to stem any market irregularities.
The most-traded stainless steel for March delivery on the Shanghai Futures Exchange SHSScv1 rose as much as 3.7% to 19,355 yuan ($3,052.45) a tonne, its highest since Oct. 27.
Shanghai stainless steel has gained 12% this year, outshining other commodities in top metals consumer China's ferrous complex, as prices of key raw material nickel rose on tight supply concerns.
Replenishment demand from Chinese downstream enterprises after this month's Spring Festival is expected to support stainless steel prices, Huatai Futures analysts said in a note.
Seasonally-tight supply of nickel ore from the Philippines, China's biggest source of the material, has also provided support to nickel prices, they said.
In contrast, the most-active May iron ore on China's Dalian Commodity Exchange fell a further 4.4% to 696 yuan a tonne, its weakest since Jan. 18.
Chinese regulators will meet with iron ore traders on Feb.17 in an effort to ensure market stability, following a recent price rally. Dalian iron ore has shed 16% since hitting a 5-1/2-month peak last week.
On the Singapore Exchange, the front-month March iron ore contract SZZFH2 rose 0.7% to $136.80 a tonne by 0414 GMT, after a three-session rout.
In the spot market, benchmark 62% iron ore tumbled nearly 11% over the last three sessions to hit $136 a tonne on Tuesday, SteelHome consultancy data showed.
“Authorities in Beijing have stepped up actions to stop prices overheating amid renewed efforts to keep inflation in check,” said Rodrigo Catril, a currency strategist at National Australia Bank.
Rebar on the Shanghai Futures Exchange SRBcv1 rose 1.1% after two days of losses, while hot-rolled coil SHHCcv1 gained 0.9%.
Dalian coking coal DJMcv1 climbed 1.7% and coke DCJcv1 advanced 2.2%.
Source: Reuters
The opinions expressed herein are the author's and not necessarily those of The Xinde Marine News.
Please Contact Us at：
media@xindemarine.com
.gif)
