Iron ore hits a 7-month high in China on solid demand

Iron ore prices extended gains on Monday, with the most active futures on the Dalian exchange hitting the key psychological level of 900 yuan ($122.98) a ton, boosted by solid demand and optimism in the aftermath to the decision of the main consumer, China. , to implement fiscal stimuli.

January’s most traded iron ore on the Dalian stock exchange closed the day up 2.51% at 900 yuan a ton, the highest since April 3.

China’s top parliamentary body approved a 1 trillion yuan sovereign bond issue as well as a bill allowing local governments to advance part of their 2024 bond quotas, the latest efforts to stimulate its economy.

Baoshan Iron and Steel, China’s largest listed steelmaker, expects the country’s steel demand to find strong support from traditional and new infrastructure sectors in the last quarter of this year and into 2024.

Support also comes from “remaining strong demand for iron ore as fewer mills than expected have cut production despite continuously reduced margins,” analysts at Sinosteel Futures said in a note.

Source: Terra

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