- Iron ore spot markets finished mixed on Tuesday, mirroring the price performance seen a session earlier.
- A key speech from Chinese President Xi Jinping failed to announce any specific measures to support Chinese economic activity. There was little reaction to news that China’s government will shutter 11 steel firms with the potential for further closures.
- China’s three-day Central Economic Work Conference (CEWC) is expected to begin today. This carries the potential to shift sentiment across the steel and bulk commodity complex.
Iron ore spot markets diverged again on Tuesday, continuing the theme seen on Monday.
According to Metal Bulletin, the price for benchmark 62% fines tumbled 2% to $69.03 a tonne, partially reversing some of the strong gains seen late last week.
However, the weakness in the benchmark did not extend to lower and higher grades with 58% fines lifting 0.2% to $44.37 a tonne while 65% Brazilian fines held steady at $85.30 for a second consecutive session.
The mixed price performance followed a speech from Chinese President Xi Jinping on Tuesday. Xi failed to outline any specific measures to help stabilise Chinese economic activity, disappointing some investors who were hoping for increased infrastructure investment or further reforms to China’s industrial sector.
There was also little reaction to an announcement from China’s industry ministry that it will remove 11 steel firms from a list of qualified enterprises, effectively banning them from operating, according to Reuters.
The ministry also ordered another 17 firms to rectify environmental, safety and other breaches or face being shuttered as well.
Like spot markets, futures traders largely ignored the news flow with very little movement seen across the most actively-traded steel and bulk commodity contracts on Tuesday.
That theme continued in overnight trade with the exception of coking coal and coke futures which fell.
SHFE Hot Rolled Coil ¥3,436 , 0.12%
SHFE Rebar ¥3,441 , 0.67%
DCE Iron Ore ¥491.00 , 1.03%
DCE Coking Coal ¥1,209.00 , -1.67%
DCE Coke ¥1,988.00 , -0.67%
Rebar, hot-rolled coil and iron ore futures inched higher, finishing above Monday’s night session close of 3,427, 3,435 and 485 yuan respectively.
Coking coal and coke futures went in the other direction, slipping from 1,239 and 2,013.5 yuan respectively on Monday evening.
Chinese commodity futures will resume trade at midday AEDT.
China’s three-day Central Economic Work Conference (CEWC) is expected to begin today, an event that carries the potential to shift sentiment across both physical and futures markets.
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