Iron ore dips on increased supply; dollar strength caps gains
SINGAPORE: Iron ore futures prices fell for a third consecutive session on Thursday on rising shipments from Australia and Brazil, although gains were capped by a weakening U.S. dollar.
The most-traded September iron ore contract on China's Dalian Commodity Exchange (DCE) ended morning trade 0.36% lower at 698.5 yuan ($97.51) a metric ton.
The benchmark July iron ore on the Singapore Exchange was 0.37% lower at $92.4 a ton, as of 0354 GMT.
'Iron ore futures threatened to record a new year-to-date low as robust supplies and lower steel production in China weigh on sentiment,' said ANZ analysts.
According to data from Chinese consultancy Mysteel, inventories of imported iron ore sintering fines have risen for the third straight week to 12.3 million tonnes by June 25.
Meanwhile, consumption of imported sintering fines fell 1.5% week-on-week, Mysteel added.
Iron ore extends decline on rise in supplies, off-season demand woes
Still, providing some support to prices was a weaker U.S. dollar, which tumbled to multi-year lows as U.S. President Donald Trump's comments on replacing Federal Reserve Chair Jerome Powell sparked concerns regarding the independence of the Fed.
A weaker greenback makes dollar-denominated assets cheaper for holders of other currencies.
Major producer Vale has increased its supply of iron ore due to an end-of-season rush, significantly contributing to increased global iron ore shipments from Australia and Brazil, said broker Everbright Futures.
China's Premier Li Qiang said on Thursday that policymakers would take 'forceful steps' to boost domestic consumption.
Other steelmaking ingredients on the DCE rose, with coking coal and coke up 1.45% and 0.58%, respectively.
Most steel benchmarks on the Shanghai Futures Exchange lost ground. Rebar fell 0.47%, hot-rolled coil dipped 0.36%, wire rod inched 0.21% lower, and stainless steel rose 1.28%.
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