China's iron ore futures jump as steel demand rises

Benchmark iron ore futures in China rose on Monday, gaining as much as 2.7%, supported by a recovery in consumption of steel products used in construction and manufacturing activity.

The most actively traded iron ore futures on the Dalian Commodity Exchange, for January delivery, closed up 0.3% at 852 yuan ($124.73) per tonne. It rose to 872 yuan per tonne earlier in the session.

Consumption of five main steel products used in the construction and manufacturing sectors jumped 2.7% as of Sept. 3 from the week earlier, data from consultancy Mysteel showed.

Capacity utilisation rates at 163 steel mills across China, meanwhile, stood at 85.38% last week, compared with 85.27% in the same period a year earlier, according to Mysteel.

Other steelmaking ingredients also rose, with Dalian coking coal firming 0.7% to 1,286 yuan a tonne and coke inching up 0.2% at 3,023 yuan a tonne.

Spot prices for iron ore with 62% iron content for delivery to China fell by $2 to $126 per tonne on Friday from the previous session. Steel rebar on the Shanghai Futures Exchange, for January delivery, dipped 0.6% to 3,736 yuan a tonne.

Hot-rolled coils, used for cars and home appliances, fell 1.3% to 3,864 yuan per tonne.

Stainless steel, for November delivery, edged down 0.3% to 14,805 yuan a tonne.