Sierra Leone woos miners to clean energy with $11 billion plan
Most mining firms rely on their own diesel supplies to extract iron ore, diamonds, rutile and bauxite in the resource-rich country.
Chinese iron ore futures rebounded to close higher for a third straight session on Wednesday on optimism that further policy support will be rolled out to minimize the economic fallout from a global coronavirus outbreak.
The Dalian Commodity Exchange’s most-traded May iron ore contract ended up 0.9% at 660 yuan ($95.13) a tonne, after falling 2.3% in the morning.
Earlier in the session, Dalian iron ore was sold down as a steadily rising steel inventories in China, which accounts for more than half of the world’s steel output, raised doubts over a recovery in demand for the steelmaking raw material.
The Dalian Commodity Exchange’s most-traded May iron ore contract ended up 0.9% at 660 yuan ($95.13) a tonne, after falling 2.3% in the morning
China’s central bank kept short-term borrowing costs steady on Wednesday despite an emergency policy rate cut by the U.S. Federal Reserve, but markets widely expect Chinese authorities will eventually take more easing measures to prop up the economy.
As a new round of monetary easing globally has kicked off, a further interest rate cut in China is looming, said Helen Lau, a metals and mining analyst at Argonaut Securities in Hong Kong.
“As more and more countries are coordinating in monetary easing, China is provided more room to ease monetary policy,” she said.
Beijing has already introduced policies to provide tax and financing support for businesses hit by the epidemic, but grim factory activity data released in recent days suggested the urgency of additional stimulus measures.
A more aggressive stimulus package could help fuel a recovery in steel demand in China’s manufacturing and construction sectors after weeks of work stoppages and restrictions to contain the outbreak.
China’s construction steel rebar inventory has piled up to a record high amid a slow recovery in demand, while stockpiles of hot-rolled coil, used in cars and home appliances, hit their highest in two years, based on industry data tracked by SteelHome consultancy.
High inventory and tepid demand have prompted many Chinese steel mills to curtail production.
Rebar on the Shanghai Futures Exchange rose 1.2%, while hot-rolled coil gained 0.5%.
Stainless steel shed 1.3%.
Other ferrous raw materials fell, with coking coal and coke both down 0.2%.
Spot iron ore prices jumped to one-week highs on Tuesday, with the benchmark 62% grade settling at $89 a tonne, supported by stockpiling by some steel mills, SteelHome data showed.
($1 = 6.9382 yuan)
(By Enrico dela Cruz; Editing by Devika Syamnath and David Evans)
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