Mon Apr 29, 2013
* China steel firms "should not blindly expand output" -CISA
* Iron ore at 5-wk lows, has dropped in 9 of past 10 sessions
By Manolo Serapio Jr
SINGAPORE, April 29 (Reuters) - Spot iron ore prices are likely to slip further this week as softer steel demand may prod Chinese steel mills to curb output, although a shorter trading
period in Beijing will limit market activity.
China's steel industry body on Saturday warned that an anticipated rise in demand would not be enough to justify sharp increases in production by the country's steel mills -- world's
biggest iron ore buyers -- in coming months.
"Downstream demand will gradually improve, but at the same time it is difficult to see any relatively big rises in steel consumption, and the expectations of steel firms should not be
too high, and they should not blindly expand output," Zhu Jimin, chairman of the China Iron and Steel Association, said on Saturday.
China's daily crude steel output has stayed near record highs above 2 million tonnes since mid-February as producers banked on demand that typically peaks during the second quarter.
But a tepid economic recovery in China also meant a slow pickup in steel demand.
"The mood is generally bearish. Mills are keeping their iron ore inventory low because I think they are considering production cuts in the future," said an iron ore trader in Hong
Kong.
Stockpiles of iron ore at major Chinese ports rose slightly to above 68 million tonnes last week, data from industry consultancy Mysteel showed, reflecting slack demand from
domestic mills.
"The fact that the port stocks haven't really been moving shows there is not a lot of buying interest," the Hong Kong trader said.
Benchmark 62-percent grade iron ore .IO62-CNI=SI eased 0.4 percent to $134.10 a tonne on Friday, matching a low last seen on March 20, based on data from the Steel Index.
The commodity dropped nearly 3 percent last week, its steepest such loss since mid-March. Prices have fallen in nine of the last 10 sessions.
Chinese markets are shut from Monday to Wednesday for public holidays.
Iron ore indexes
Last Change Pct Change
THE STEEL INDEX 62 PCT INDEX 134.1 -0.50 -0.37
METAL BULLETIN INDEX 132.84 +0.00 +0.00
Index in dollars/tonne, show close for the previous trading day
(Reporting by Manolo Serapio Jr.)
* China steel firms "should not blindly expand output" -CISA
* Iron ore at 5-wk lows, has dropped in 9 of past 10 sessions
By Manolo Serapio Jr
SINGAPORE, April 29 (Reuters) - Spot iron ore prices are likely to slip further this week as softer steel demand may prod Chinese steel mills to curb output, although a shorter trading
period in Beijing will limit market activity.
China's steel industry body on Saturday warned that an anticipated rise in demand would not be enough to justify sharp increases in production by the country's steel mills -- world's
biggest iron ore buyers -- in coming months.
"Downstream demand will gradually improve, but at the same time it is difficult to see any relatively big rises in steel consumption, and the expectations of steel firms should not be
too high, and they should not blindly expand output," Zhu Jimin, chairman of the China Iron and Steel Association, said on Saturday.
China's daily crude steel output has stayed near record highs above 2 million tonnes since mid-February as producers banked on demand that typically peaks during the second quarter.
But a tepid economic recovery in China also meant a slow pickup in steel demand.
"The mood is generally bearish. Mills are keeping their iron ore inventory low because I think they are considering production cuts in the future," said an iron ore trader in Hong
Kong.
Stockpiles of iron ore at major Chinese ports rose slightly to above 68 million tonnes last week, data from industry consultancy Mysteel showed, reflecting slack demand from
domestic mills.
"The fact that the port stocks haven't really been moving shows there is not a lot of buying interest," the Hong Kong trader said.
Benchmark 62-percent grade iron ore .IO62-CNI=SI eased 0.4 percent to $134.10 a tonne on Friday, matching a low last seen on March 20, based on data from the Steel Index.
The commodity dropped nearly 3 percent last week, its steepest such loss since mid-March. Prices have fallen in nine of the last 10 sessions.
Chinese markets are shut from Monday to Wednesday for public holidays.
Iron ore indexes
Last Change Pct Change
THE STEEL INDEX 62 PCT INDEX 134.1 -0.50 -0.37
METAL BULLETIN INDEX 132.84 +0.00 +0.00
Index in dollars/tonne, show close for the previous trading day
(Reporting by Manolo Serapio Jr.)
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