BEIJING (Reuters) – China’s iron ore futures rose on Monday, the second day the contracts have been open to direct trade by foreign investors, with robust restocking demand amid resuming steel capacity helping to push prices higher.
“Downstream demand remains very strong at this moment as construction sites rush to work as much as they can before rainy season starts in June,” said Gu Meng, analyst at Orient Futures.
The utilization rate at steel mills continued to pick up last week. As of May 4, it was up 1.24 percentage points from the previous week to 68.92 percent, the highest since mid-November, according to data from Mysteel consultancy.
The most-traded September iron ore contract settled up 0.2 percent at 470 yuan ($73.86) a tonne on Monday. Volume on the contract reached 3.2 million lots, exceeding April’s daily average of 2.8 million lots.
It also topped the nearly 2.9 million lots traded for September on Friday, when the exchange opened the door to foreign investors. The steelmaking raw material is the second commodity China has opened to overseas investors after the launch of crude oil futures in March.