Iron ore spot markets stabilised on Wednesday following some wild price movements earlier in the week.
According to Metal Bulletin, the spot price for benchmark 62% fines rose by 0.6% to $82.05 a tonne, a stark divergence from the moves seen in the previous two sessions when prices surged by 3.9% only to plunge 2.5% a day later.
Year to date it has gained 4%, having added 81% in 2016.
Lower grade ore recorded a slightly smaller gain on the day, while higher grade ores traded flat.
Perhaps contributing to the relative stability in spot markets, Metal Bulletin said that wild gyrations in rebar futures during Wednesday’s session saw activity in spot and physical markets slow to a crawl.
“Rebar futures experienced sharp fluctuations in a range of over 100 yuan per tonne during the day, which led market participants to keep prices flat while they waited for a clearer trend to emerge,” the group said.
“Trading activity was very low with stockists stopping procurement amid instability in futures.”
Increased speculative activity in Chinese commodity futures almost certainly contributed to some of the enormous gains seen across many contracts in 2016.
And they were as volatile as ever in overnight trade, with wide ranges recorded across rebar, iron ore and coking coal contracts.
The May 2017 iron ore future on the Dalian Commodities Exchange slipped 1.4%, closing the session down 1.4%.
Both rebar and coking coal also finished lower, sliding 1.3% and 0.6% respectively.
Trade in Chinese commodity futures will resume at Midday AEDT.