Iron ore slips as bleak China credit data worsens demand woes
BEIJING, Aug 14 (Reuters) -Iron ore futures fell on Wednesday, as disappointing credit data from top consumer China worsened sour market sentiment already dampened by diminishing demand and high supply.
The most-traded January iron ore contract on China's Dalian Commodity Exchange (DCE) DCIOcv1 traded 2.51% lower at 719 yuan ($100.61) a metric ton, as of 0230 GMT.
The contract hit its lowest since Aug. 10, 2023 at 715 yuan a ton earlier in the session.
The benchmark September iron ore SZZFU4 on the Singapore Exchange hovered below the key psychological level of $100 a ton for a fifth straight session, down 1.18% to $97.4 a ton, the lowest since April 8.
China's bank lending tumbled more than expected in July, hitting the lowest in nearly 15 years, official data showed on Tuesday, dragged down by tepid credit demand and seasonal factors.
"The credit data in July remained weak, weighing on sentiment ... hot metal output showed signs of further declines given that many mills are suffering loss," analysts at Everbright Futures said in a note.
Analysts at GF Futures expected hot metal output to fall by up to 20,000 tons this week.
China's iron ore demand in 2024 will shrink by 33.4 million tons, Jia Yanlin, the director of the research institute of China Mineral Resources Group (CMRG), was cited as saying by a state-backed media.
CMRG was established in July 2022 to enhance Beijing's iron ore pricing power and ensure a secure supply chain for some key mineral resources.
Jia forecast ore supply to China this year to increase by 71 million tons from the year earlier, and China's steel exports to hover 90 million tons, similar to the levels seen in 2023.
Other steelmaking ingredients on the DCE retreated to more than one-year lows, with coking coal DJMcv1 and coke DCJcv1 down 2.36% and 1.4%, respectively.
Steel benchmarks on the Shanghai Futures Exchange slid further. Rebar SRBcv1 fell 1.84%, hot-rolled coil SHHCcv1 lost 1.97%, wire rod SWRcv1 slipped 2.11% and stainless steel SHSScv1 shed 0.77%.
($1 = 7.1467 Chinese yuan)
Reporting by Amy Lv and Mei Mei Chu; Editing by Sherry Jacob-Phillips
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