Benchmark Dalian iron ore extends rally into ninth day China's...

• Benchmark Dalian iron ore extends rally into ninth day
• China's iron ore imports on downward trend - Kpler data
• Spot 62% iron ore price scales 4-week peak - SteelHome

China's iron ore futures rose on Friday and were set for their biggest weekly gain since early September on concerns over tightening seaborne supplies of the steelmaking raw material that have pushed spot prices to four-week highs.

Extending gains into a ninth straight session, iron ore on the Dalian Commodity Exchange DCIOcv1 climbed as much as 3.0% to 676.50 yuan ($96.24) a tonne in morning trade. On the Singapore Exchange, iron ore futures were up 0.9% at $89.25.

The benchmark Dalian contract, which was on track for a more than 7% rise from last week, has recouped all its losses suffered earlier this year.

The price rally began last week after Brazil's Vale SA VALE3.SA on Feb. 11 scaled down its first-quarter iron ore production outlook following heavy rain that hampered operations.

Supply worries intensified this week after Anglo-Australian miner Rio Tinto (RIO) RIO.L lowered its shipment forecast for the steelmaking raw material from Australia's Pilbara region after a tropical cyclone damaged some infrastructure.

The downbeat supply estimates from Vale and Rio came as iron ore shipments to China from Brazil and Australia have already been on a downward trend as unloading of cargoes were hampered at ports in the wake of the COVID-19 outbreak.

China's iron ore imports in January were estimated at an average 3.2 million tonnes a day in January, down from the prior month's average of 3.3 million tonnes a day, according to French data firm Kpler, which tracks commodity flows.

The average dipped to 2.936 million tonnes a day in the first half of February and has fallen further, with the latest month-to-date daily average at 2.912 million tonnes, said Alex Booth, Kpler head of market analysis.

Despite tightening seaborne supplies of iron ore, China's steel production continues.

"Steel mills are still running, albeit at slower run rates, to cover costs," said ANZ commodity strategists in a note.

FUNDAMENTALS

• Spot prices for benchmark 62% iron ore settled at $92.50 a tonne on Thursday, the highest since Jan. 22, SteelHome consultancy data showed. SH-CCN-IRNOR62
• China's steel futures also stretched gains even as inventories have piled up dramatically as work stoppages and travel curbs to contain the epidemic dented downstream demand.
• Construction steel rebar on the Shanghai Futures Exchange SRBcv1 was up 0.8% while hot-rolled steel coil SHHCcv1 rose 0.6%.
• Coking coal DJMcv1 slumped 1.2% but coke DCJcv1 gained 0.5%.

  ($1 = 7.0290 yuan)