June 12, 2020 / 8:14 AM / a month ago

UPDATE 1-Iron ore futures log weekly gain on upbeat demand, Brazil supply concerns

* Iron ore futures rise 3.5% for the week

* Spot 62% iron ore stood at $104.5 per tonne

* Iron ore out-performance has further room to run - Fitch Solutions (Adds details; Updates with closing prices)

BEIJING, June 12 (Reuters) - Benchmark iron ore futures in China ended higher on Friday and posted a weekly gain of more than 3%, buoyed by sustaining demand at mills and concerns over supply from Brazil.

The most actively traded iron ore contract on the Dalian Commodity Exchange, for September delivery, closed up 1.9% at 777 yuan ($109.81) a tonne. For the week, the contract gained 3.5%.

Spot prices for iron ore with 62% iron content for delivery to China fell by $0.5 to $104.5 a tonne on Thursday.

Fitch Solutions expects iron ore rallies could roll on in the coming months as mills in China are gearing up in tandem with the country’s economic recovery.

“We expect steel production to ramp up and average 5% year-on-year growth in 2020, buoying demand for iron ore,” Fitch Solutions wrote in a note.

Capacity utilisation rates at blast furnaces in 247 mills in China rose to 92.35% this week, data compiled by consultancy Mysteel showed on Friday.

Construction rebar on the Shanghai Futures Exchange , for October delivery, rose 0.9% to 3,626 yuan a tonne.

Hot-rolled coil, used in the manufacturing sector, jumped 1.2% to 3,583 yuan per tonne.

FUNDAMENTALS

* Dalian coking coal and coke both rose 0.4% to 1,188 yuan and 1,970 yuan per tonne, respectively.

* The most traded August contract for stainless steel on the Shanghai exchange fell 0.6% to 12,765 yuan a tonne.

* Western Australia approved BHP Group’s application to disturb 40 culturally significant Aboriginal sites as part of a mine expansion, the state government said on Thursday, days after Rio Tinto blew up sacred rock caves in the same area.

* China’s Baoshan Iron & Steel raised prices for both hot-rolled coil and cold-rolled coil for July delivery by 280 yuan per tonne. ($1 = 7.0761 Chinese yuan) (Reporting by Min Zhang and Tom Daly, Editing by Sherry Jacob-Phillips, Aditya Soni)

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