China’s iron ore futures steadied clinging to the prior session’s gains when they climbed more than 2% as investors kept their bets on a recovery that has eluded the market due to plentiful supply.
Iron ore for September delivery on the Dalian Commodity Exchange was unchanged at CNY 709 per tonne by 0325 GMT, after gaining more than 2% on Tuesday.
According to data compiled by Steel Index, Iron ore for immediate delivery to China .IO62-CNI=SI rose 0.6% to USD 96.50 per tonne on Tuesday.
A trader in Shanghai who has held off from buying iron ore until stronger signs emerge on where prices are headed said “In my opinion right now it’s 50 50, there’s not too much downside, there’s not too much upside for the market.”
Traders said that there is particularly an oversupply of lower grade iron ore cargoes in the market, prompting most sellers to offer deep discounts. Miners making deeper cuts in prices for clients as competition heats up have included Rio Tinto and Fortescue Metals Group.
Source – Reuters