* Baosteel halts ops at Shanghai plant amid slowdown
* China infrastructure boost may have limited impact
* Vale sees iron ore prices hovering between $100-$120
By Manolo Serapio Jr
SINGAPORE, Sept 27 Spot iron ore prices ticked
higher in a slow market on Thursday, with most Chinese steel
mills nearly through with restocking the raw material ahead of a
Benchmark iron ore with 62 percent iron content
.IO62-CNI=SI rose half a percent to $104.20 a tonne on
Wednesday, according to data provider Steel Index.
"There are very few inquiries and deals as the holidays
approach. Many mills have already finished with their
restocking, although a few are still in the market," said an
iron ore trader in the port city of Rizhao in China's eastern
Chinese markets are shut all of next week for the National
Iron ore prices fell to three-year lows at below $87 a tonne
earlier this month as waning steel demand in China cut appetite
for the steelmaking ingredient. Prices have since bounced back
to above $100, though they remain 30 percent off this year's
peak as Chinese steel mills curb output.
"I think iron ore prices have hit the bottom, but a stronger
recovery depends on steel demand which remains sluggish so far,"
said Henry Liu, head of commodity research at Mirae Asset
Baoshan Iron and Steel Co, China's biggest
listed steelmaker, said it had suspended production at a
loss-making plant in Shanghai, in a sign of the intense pressure
on the sector.
Baosteel is one of the first major Chinese mills to publicly
disclose it is suspending production, but with the world's
second-biggest economy cooling and banks restricting lending to
an industry that built up $400 billion of debt during years of
double-digit growth, more suspensions are likely.
The more than $150 billion of infrastructure projects that
the Chinese government approved recently will have minimal
impact on steel demand in the world's biggest consumer, a
Baosteel official told an industry conference.
Shanghai steel rebar futures have dropped more than 14
percent this year on slower Chinese demand, slashing appetite
for iron ore, the biggest revenue earner for top miners Vale
, Rio Tinto and BHP Billiton
On Thursday, the most-traded January Shanghai rebar futures
rose 1.3 percent to 3,571 yuan ($570) a tonne, but its
gains were mostly driven by a jump in Shanghai equities.
The hardest hit among industrial commodities this year by
China's slower economic growth, iron ore prices have lost about
a quarter this year, although Vale said it would push ahead with
all its projects.
Vale expects prices to hover between $100 and $120,
depending on how fast low cost production comes onstream, said
Jose Carlos Martins, executive director for ferrous and
Shanghai rebar futures and iron ore indexes at 0535 GMT
Contract Last Change Pct Change
SHFE REBAR JAN3 3571 +44.00 +1.25
PLATTS 62 PCT INDEX 106 +0.50 +0.47
THE STEEL INDEX 62 PCT INDEX 104.2 +0.50 +0.48
METAL BULLETIN INDEX 106.59 +0.27 +0.25
Rebar in yuan/tonne
Index in dollars/tonne, show close for the previous trading day
($1 = 6.3020 Chinese yuan)
(Reporting by Manolo Serapio Jr.; Editing by Joseph Radford)