Dalian iron ore futures extended their gains to a third session on Wednesday, underpinned by prospects of tighter supply and optimism over steel demand in China.
Benchmark prices of the steelmaking ingredient in Singapore, however, retreated after three straight sessions of gains.
The most-traded May iron ore on China’s Dalian Commodity Exchange ended morning trade 0.9 percent higher at 885 yuan ($128.49) a ton.
On the Singapore Exchange, the most-active May iron ore contract was down 0.5 percent at $121.90 a ton.
Iron ore’s divergent paths reflected mixed sentiment, with traders expecting steel demand to rise during the spring construction season in China, while domestic steel production restrictions and regulatory risks are seen weighing on prices.
China is considering cutting its crude steel output by about 2.5 percent this year, Reuters has reported citing two sources familiar with the matter, as it extends a two-year-old policy to reduce emissions by the world’s biggest steel producer.
At the moment, “iron ore consumption is supported by rigid demand”, Huatai Futures analysts said in a note.
