Iron ore rebounds from two-year low on dip buying, improving steel margins

Business Recorder reported that iron ore prices recovered on Friday after falling to their lowest levels in more than two years the previous day. Buyers stepping in on weakness lifted the most-traded contract on China's Dalian Commodity Exchange, which rose 0.22% to 673.5 yuan ($100.65) a metric ton by 0157 GMT yet remained 1.3% lower for the week.

The benchmark November contract on the Singapore Exchange climbed 0.56% to $90.35 a ton by 0147 GMT, although it had slipped 0.3% during the week. Analysts called the bounce a short-lived technical recovery, helped by slightly better steel mill profitability. Mysteel data showed around 8% of domestic steelmakers were profitable as of October 15, compared with 6.9% the previous week.

The slower drop in hot metal output suggested mills will need to rebuild feedstock stocks, according to First Futures analysts. Still, portside stockpiles grew, and weak margins plus a slack period ahead kept downside risks alive. Coking coal dropped 1.8% and coke 0.56% as supply in key producing regions picked up, while Shanghai steel futures moved within a narrow band.