Benchmark iron ore futures in China rose for a second straight session on Wednesday, boosted by expectations of firm demand for the steelmaking ingredient as the rainy season in eastern China comes to an end. The most actively traded iron ore futures on the Dalian Commodity Exchange, for September delivery, gained as much as 3.6% to 862 yuan ($123.67) per tonne in early trade. It closed up 1.1% to 842 yuan per tonne.
Steel prices on the Shanghai Futures Exchange also gained, with construction rebar ending up 1.3% at 3,782 yuan a tonne and hot-rolled coils closed 1.0% higher at 3,802 yuan per tonne. Demand would continue to rise amid expectations of a resumption in downstream consumption as the rainy season is over in some areas, Huatai Futures wrote in a note, adding steel prices had room to climb further on positive market sentiment.
The longer-than-usual rainy season this year has ended in the eastern region of China, including Shanghai, and Jiangsu and Zhejiang provinces, according to local observatories, who warned there could still be rains and floods.
