Iron ore hits near 1-month low on China concerns, Fed outlook
Updates closing prices
By Amy Lv and Colleen Howe
BEIJING, Dec 19 (Reuters) -Iron ore futures prices fell on Thursday to their lowest in nearly a month, as concerns about demand prospects in top consumer China and the U.S. Federal Reserve's outlook for interest rate cuts next year weighed on sentiment.
The most-traded May iron ore contract on China's Dalian Commodity Exchange (DCE) DCIOcv1 ended daytime trade 1.08% lower at 778.5 yuan ($106.66) a metric ton, after hitting the lowest since Nov. 22 at 767.5 yuan earlier in the session.
The benchmark January iron ore SZZFF5 on the Singapore Exchange shed 0.43% to $102.25 a ton by 0700 GMT. It touched the lowest level since Nov. 25 at $100.9 earlier.
"We've long anticipated this correction, as the sentiment-driven bubble around China's Central Economic Work Conference was eventually going to burst with no concrete stimulus measures outlined until March 2025," said Atilla Widnell, managing director at Navigate Commodities.
"This week has seen a perfect storm of loosening supply - and demand-side fundamentals with BHP resuming production from its South Flank mine in Western Australia while mills in China are also heard to be scaling back production."
BHP BHP.AX, one of the world's leading iron ore suppliers, resumed operations at two mines in Western Australia after a pause due to heavy rains, alleviating supply worries.
"Also, fears over the health of China's property sector are rearing their ugly head as financial markets question the liquidity and solvency of China Vanke - the last remaining (state-owned) jewel in this sector's crown," Widnell said.
The Fed commentary that next year will see fewer rate cuts also pressured broad commodities, said analysts.
Other steelmaking ingredients on the DCE retreated, with coking coal DJMcv1 and coke DCJcv1 down 3.65% and 0.9%, respectively.
Most steel benchmarks on the Shanghai Futures Exchange lost ground. Rebar SRBcv1 lost 1.5%, hot-rolled coil SHHCcv1 slid 1.55%, and stainless steel SHSScv1 fell 0.92% while wire rod SWRcv1 added 0.14%.
($1 = 7.2986 Chinese yuan)
Reporting by Amy Lv and Colleen Howe; Editing by Varun H K and Subhranshu Sahu
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