Chinese steel and iron ore prices gained over Monday and the weekend. Confidence has improved in domestic markets but iron ore port stocks have finally begun to increase.

On the Shanghai Futures Exchange the October rebar contract closed at CNY 3,387/tonne ($481/t), up CNY 14/t, while the same contract for hot rolled coil closed up CNY 11/t at CNY 3,220/t. In Tangshan, billet prices were up CNY 10/t at CNY 3,060/t.

The Kallanish KORE 62% Fe index gained $2.49/t on Monday to $86.99/dry metric ton cfr Qingdao. The KORE 65% index meanwhile gained $2.45/t to $102.19/dmt, and the KORE 58% Fe index gained $2.27/t to $76.71/dmt. On the Dalian Commodity Exchange, September iron ore settled up CNY 3/t at CNY 599.5/t. On the Singapore Exchange, May 62% Fe futures settled up $0.89/t at $82.64/t, 65% Fe futures up $0.83/t at $96.68/t and 58% Fe futures up $0.33/t at $72.59/t.

China’s stock of iron ore at ports increased last week for the first time in months. Stock across 35 ports was up 1.57 million tonnes last week at 108.43mt, according to a count by SMM. In part that was due to lower shipments to mills from ports. But it was also due to higher deliveries from Brazil and Australia. That trend is expected to continue and stocks could continue to increase until Chinese steel demand and production pick up.

China’s domestic economy is showing some signs of recovery, albeit slowly. Credit issuance in March was up 11.5% year-on-year, the fastest since August 2018. Much of this has been emergency loans to businesses to tide them over the coronavirus shutdown. As bank lending is still being encouraged however, this should filter into normal economic activity in the coming months.