Following a strong rally in futures, the spot iron ore price bounced modestly on Friday.
According to Metal Bulletin, the spot price for benchmark 62% fines rose by 33 cents, or 0.69%, to $48.14 a tonne. For the week the benchmark price fell 0.15%, extending this years losses to 32.4%.
Chinese iron ore futures traded flat on Friday evening, providing no indication on what direction spot pricing is likely to move this evening.
The gain in spot prices followed news that Chinese steel production fell for the first time since mid-September, coinciding with a drop in overall inventory levels.
“The China iron and steel association (CISA) have announced that China’s crude steel output retreated in late October, after continuous increases since mid-September,” said analysts at Metal Bulletin in a research note.
“CISA member mills produced crude steel at an average daily rate of 1.74 million tonnes during the last eleven days of October, down 3.6% from the preceding period. No significant production cuts are expected to take place before the end of the year. As at October 31, combined finished steel inventory at CISA member mills
totalled 14.8 million tonnes, down 9.4% from October 20 levels, according to the data.”
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