Prices of iron ore futures slipped on Thursday, as top consumer China’s accumulating steel stocks in the peak demand season weighed on sentiment.

The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) closed daytime trade 0.81% lower at 795.5 yuan ($111.69) a metric ton.

The benchmark October iron ore on the Singapore Exchange lost 1.24% to $105.5 a ton, as of 0835 GMT.

“Steel inventories continued to pile up while demand has not yet showed clear signs of improvement, so bears dominated the trend,” said a Shanghai-based analyst.

Stocks of the five major steel products have risen for a seventh straight week to an over four-month high of 15.15 million tons in the week of September 10, data from consultancy Mysteel showed.

Earlier in the session, prices were rangebound as traders awaited key China data, including property, economic growth and output of industrial metals due Monday, for cues on demand.

A tight balance between supply and demand of the key steelmaking ingredient is expected to provide support to ore prices, analysts at brokerage First Futures said, curbing losses.

Still, the focus is on whether Beijing will enforce steel production cuts across the country in the remainder of the year to rebalance a market that has been grappling with overcapacity and faltering home demand.

Most steel benchmarks on the Shanghai Futures Exchange lost ground. Rebar RBF1! dipped 0.51%, hot-rolled coil nudged down 0.03%, stainless steel shed 0.35% while wire rod (SWRcv1) added 0.37%.

Prices of coking coal and coke (DCJcv1), also steelmaking ingredients, rose 2.33% and 1.81%, respectively, as the latest mine accident in northeastern China’s Heilongjiang province raised concerns over more stringent safety checks that could constrain supply, said analysts.

All six people trapped at the mine have been successfully rescued, state media reported on Thursday.
Source: Reuters