(Yicai Global) Jan. 18 -- China's iron ore futures stabilized after regulators took actions for the third time this year to curb price hikes of the major raw material to make steel to stop speculation.
The most actively traded contracts of iron ore futures on the Dalian Commodity Exchange edged up 0.9 percent to CNY841.5 (USD124) a ton at close today, down around 5 percent from Jan. 13 when the price hit a nearly seven-month high.
The National Development and Reform Commission, the State Administration for Market Regulation, and the China Securities Regulatory Commission recently summoned iron ore trading companies and futures firms to warn them against price gouging and spreading false information, the NDRC announced on its WeChat account today.
This is the third that the NDRC pinpoints iron ores this year. On Jan. 15, the macroeconomic management agency said it talked with related information providers to warn them about disseminating fabricated data. On Jan. 6, it held a meeting to study how to enhance price control.
Winter is usually the peak season for Chinese steel mills to replenish their inventory of raw materials, causing price hikes. However, experts predict the relationship between supply and demand is likely to improve this year.
Iron ore delivery is stable, and major mines will raise their production this year. Overseas demand may decline due to recession worries abroad, leading some overseas supply to flow to China, Zhu Shiwei, executive vice president of Yongan Futures’ Beijing Research Institute, told Yicai Global.
China's 2023 crude steel output will basically remain unchanged from last year, Zhu predicted. As the country raises the recycling efficiency of steel scrap and domestic mines develop, the supply and demand of iron ores will become better, Zhu concluded.
Editors: Dou Shicong, Emmi Laine, Xiao Yi