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Iron ore hits five-month high

Issued at 2023-09-17



The Kallanish KORE 62% Fe index rose by $1.01/tonne and the KORE 65% Fe index gained $1.64/t on Thursday to $123.51/dry metric tonne cfr Qingdao and $132.82/dmt cfr respectively. The KORE 58% Fe index inched up by $0.16/t to $109.13/dmt cfr.
On the Dalian Commodity Exchange (DCE), January 2024 iron ore gained by CNY 2.5/t ($0.34/t) at CNY 859/t ($118/t). On the Singapore Exchange, September 62% Fe futures and September 65% Fe futures settled $1.21/t and $0.71/t higher respectively at $120.63/t and $131.06/t. The same contract for 58% Fe futures, meanwhile, was unchanged at $105.62/t.
Two deals each of 170,000 tonnes of PB fines were sold at $120.7/t and $122.7/t respectively with a laycan of 2-11 November and 4-13 November. Another 90,000t of Mac fines were booked at $119.5/t with a laycan of 6-15 October.
Scrap and billet prices remained stable on Thursday. 6mm+ heavy scrap delivered to mills in the Yangtze River Delta was at CNY 2,855/t. Tangshan billet remained at CNY 3,530/t.
On Thursday night, the People's Bank of China announced it would lower the deposit reserve ratio (RRR) for financial institutions by 0.25% starting from 15 September. This is also the second RRR cut this year. In March, the People's Bank of China also announced a reduction of 0.25%.
Zhou Maohua, a macroeconomic researcher at the Financial Market Department of China Everbright Bank, says this RRR cut is basically in line with market expectations. It reflects the central bank's increased efforts to stabilise economic growth, which can boost market confidence in economic recovery.
Kallanish believes this proactive fiscal policy will also help promote the implementation of recent stimulus measures for the real estate market. By lowering the reserve requirement ratio, banks can also release more funds for credit business, which will help promote the issuance of housing loans and drive a rebound in real estate transactions.


Source: kallanish.com/



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