SINGAPORE- Iron ore futures dipped on Monday, dragged by a sluggish manufacturing sector in China and lingering concerns about steel demand.
The most-traded September iron ore on China’s Dalian Commodity Exchange fell 1.1 percent to 828.0 yuan ($115.90) per metric ton, and was on track for a three-session losing streak.
On the Singapore Exchange, the benchmark September iron ore fell marginally, down 0.2 percent , to $106.6 a metric ton.
China’s manufacturing activity fell for a fourth straight month in July, albeit at a slower pace, an official factory survey showed on Monday, reinforcing the need for further policy support to boost domestic demand.
Pro-growth pledges from China’s top leadership last week weren’t enough to turn around deteriorating sentiment, National Australia Bank said in a note.
“We think the market will move into a surplus with increasing steel production controls kicking off, reducing off take; meanwhile we expect iron ore supply to remain relatively stable in the second half of 2023,” Citi analysts said in a separate note.
Steel mills in China’s southwestern Yunnan province have been asked to prepare to cut back production in order to meet a government mandate on capping 2023 output at last year’s level, two Chinese consultancies said last Friday. – Reuters
