Iron ore futures rose after a choppy session on Tuesday, supported by lingering supply concerns and strong manufacturing output data from China.
The steelmaking ingredient’s most-active May contract on China’s Dalian Commodity Exchange ended daytime trading up 1.5% at 994 yuan ($151.66) a tonne after breaching the 1,000-yuan mark during the afternoon session. The key level was first hit on Friday.
Iron ore on the Singapore Exchange also reversed early losses to trade 0.9% higher at $152.83 a tonne by 0744 GMT.
Iron ore dispatched from Australia and Brazil fell for the second week over Dec. 7-13 by another 1 million tonnes or 4.7% on week to about 22.7 million tonnes, according to a Mytseel consultancy survey.
That added to concerns about a steady decline in China’s portside iron ore stockpiles, which fell to 125.85 million tonnes last week, the lowest since mid-October, based on SteelHome consultancy data.
Although data showed China’s crude steel production declined for a third straight month in November, the world’s top steel producer have ramped up output of finished products in the second half of the year amid strong stimulus-driven demand.
China’s factory output grew at the fastest pace in 20 months in November, mainly driven by robust exports.
“We expect manufacturing investment growth to remain elevated in coming quarters following its surge in November, as Beijing’s policy support…may more than offset the drag from recent rise in credit defaults,” analysts at Nomura wrote in a note.
* Spot iron ore prices in China retreated on Monday from a near eight-year peak, with the benchmark 62% material at $156.50 a tonne, SteelHome data showed. SH-CCN-IRNOR62
* Rebar on the Shanghai Futures Exchange gained 1.2%, while hot-rolled coil climbed 0.6% but stainless steel slipped 0.3%.
* Dalian coking coal slumped 1.6% but coke advanced 1.3%.