SHANGHAI, Aug. 18 (SMM) – Iron ore futures contract on the Dalian Commodity Exchange (DCE) for delivery in January 2018 closed up 6.61% at 580.5 yuan/tonne on August 18. What triggered the sudden jump?
SMM attributes the big gains to three reasons.
First, iron ore stocks at 35 ports in China have been falling for four weeks in a row, down from 134.15 million tonnes at the end of July to 127.86 million tonnes this week.
Second, coke prices have been rising since June in both spot and futures markets, while iron ore prices gained much less than coke prices.
Third, market speculation over production controls for environmental reason boosted steel mills’ demand for high-grade iron ore fines, lump and pellet. Structural supply shortage in iron ore market did not ease.
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