Chinese steel and iron ore futures advanced on Monday after China cut interest rates for the first time in more than 2 years in a bid to shore up activity in the world’s No. 2 economy.
China’s rate cut reflects a change of course by Beijing and the central bank, opting for more drastic action to stabilize an economy that continued to show signs of a slowdown following modest measures. Iron ore for May delivery on the Dalian Commodity Exchange rose 1.1% to 476 CNY ($78) a ton, off a session high of 482 CNY. Spot iron ore is at a more than 5-year low.
Chinese steel prices closed flat for the day. The price of iron ore 58% fines from India hit a high price of CNY 840.00 ($137.21) and a low price of CNY 830.00 ($135.57) per dry metric ton. For the fifth day in a row, the price of Chinese HRC remained essentially flat at CNY 2,970 ($485.12) per metric ton. The price of Chinese coking coal saw little movement at CNY 1,390 ($227.04) per metric ton.
The steel billet cash price saw essentially no change on the LME for the fifth day in a row, remaining around $465.00 per metric ton. The 3-month price of steel billet continues hovering around $455.00 per metric ton on the LME for the fifth day in a row.
After dropping for two days, the 3-month price of the US HRC futures contract flattened at $629.00. The spot price of the US HRC futures contract saw little movement last Friday at $634.00 per short ton.