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Investors wait for demand signals to see iron ore prices rise

Iron ore futures remained in a narrow range Monday as investors waited for a new batch of trade statistics from China, the world's largest consumer.

As of 0242 GMT, the most traded January iron ore contract at China's Dalian Commodity Exchange was unchanged at 787.5 Yuan ($110.44).

As of 0232 GMT, the benchmark October iron ore traded on Singapore Exchange was trading at $104.95 per ton.

Investors will be closely monitoring China's import and export statistics on Monday for any demand signals.

Steelmakers in China's top steelmaking hub gradually resumed production on September 4 following the conclusion of a military procession in Beijing commemorating the end World War Two. This signals a pickup in raw material demand.

But the sharper-than-expected fall in hot metal output, a gauge of iron ore demand, reflected demand recovery is slower than expected, raising cation among investors.

The average daily hot metal production fell by 4.7% compared to the previous week, reaching 2.29 million tonnes in the week ending September 4, the lowest level since February 28.

Coking coal and coke, the other steelmaking components, both gained 0.75 %.

The benchmarks for steel on the Shanghai Futures Exchange are mixed. Rebar fell 0.48% and wire rod dropped 0.43%. Hot-rolled coils gained 0.3% while stainless steel advanced by 0.35%.

Citi Research analysts expected a meaningful supply cut in steel in the fourth quarter. This is a traditionally slack season for demand. ($1 = 7,1307 Chinese Yuan) (Reporting and editing by Amy Lv, Lewis Jackson)

(source: Reuters)