Iron ore futures drop

The most-traded May iron ore on China’s Dalian Commodity Exchange ended morning trade 0.5% lower at 845 yuan ($122.71) a tonne, surrendering early gains.

On the Singapore Exchange, the steelmaking ingredient’s benchmark February contract was down 1% at $114.95 a tonne, as of 0433 GMT.

Reflecting persistently weak demand amid rising COVID cases — despite a slew of support measures for the ailing property sector — China’s home prices fell at a faster pace in December, according to a private survey.

“We maintain our view that underlying steel consumption from China’s property sector is unlikely to recover meaningfully in the next 3-6 months,” Citi analysts said in a Jan. 3 note.

“The property sector continues to face challenges. Job security and consumer confidence remain challenging and the current wave of COVID infections remains a headwind,” they said.

Other Dalian steelmaking inputs fell, with coking coal and coke down 2.6% and 1.5%, respectively. Steel benchmarks were mixed, with rebar on the Shanghai Futures Exchange down 0.6% and hot-rolled coil slipping 0.2%.