Iron-ore gains as freight costs rise amid Iran war; shipments fall
Iron-ore prices reversed earlier losses to trade higher on Monday, as investors shifted focus to potentially higher freight rates following the Iran conflict and falling shipments from major suppliers.
The most traded iron-ore contract on China's Dalian Commodity Exchange (DCE) closed daytime trade 0.87% higher at 754.5 yuan ($109.64) a metric ton.
The benchmark April iron-ore SZZFJ6 on the Singapore Exchange rose 0.85% to $99.2 a ton as of 0731 GMT.
Surging oil prices amid the US-Iran conflict lifted freight costs, thus lending some support to iron-ore prices, Zhengxin Futures analysts said in a note.
Helping prices of the key steelmaking ingredient was also a fall in shipments from top suppliers Australia and Brazil, which were down 0.8% week-on-week, according to analysts and data from consultancy Mysteel.
Earlier in the session,-ore prices fell due to production curbs in China's key steel hub Tangshan, after a forecast of worsening air quality activated the level-two emergency response from Sunday.
Such measures, which typically require local mills to curb production and cool demand for raw materials, follow earlier calls for northern Chinese mills to cut output to ensure cleaner air during the annual parliamentary meeting starting March 5.
Slow recovery in steel demand, mounting steel stocks and elevated portside stocks weighed down-ore prices, said Guiqiu Zhuo, an analyst at broker Jinrui Futures.
Iron-ore stocks at major Chinese ports jumped to a record high of 162.17 million tons as of February 27, data from consultancy Steelhome showed.
Coking coal and coke, other steelmaking ingredients, also shrugged off earlier losses to close daytime trade up 1.06% and 1.38%, respectively.
Steel benchmarks on the Shanghai Futures Exchange broadly gained ground. Rebar added 0.26%, hot-rolled coil advanced 0.34%, wire rod rose 0.24% and stainless steel climbed 1.91%.
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