Iron ore hits $100 a tonne for the first time since early December under This situation highlighted the weak recovery in China’s commodity demand even during what is expected to be the busiest construction period.
Iron ore had soared since late last year on hopes that post-COVID-19 reopening in China and government incentives will boost demand. However, while the economic recovery has been uneven, activity in steel mills is causing short-term expectations to decline.
In a memo on my Huatai Futures website, he wrote that the critical real estate sector “still lacks a clear recovery and uptrend.”
Construction accounts for one-third to half of the country’s steel demand overall, while the government’s ongoing effort to reduce the industry’s debt remains a major headwind for the Chinese economy and industrial commodity appetite.
This level marks an 18 percent drop in April.
The statements of the top producers China Iron and Steel Association on Tuesday, warning of difficult market conditions for the rest of this year, underlined the more pessimistic outlook.
“Recently, there has been a steady and rapid decline in steel prices in the domestic market, which has created serious difficulties for the operation and production of steel mills. Steelmaking facilities need to reduce loss-making production and keep cash,” said a note on the association’s website. .