Iron Ore Prices Climb As Beijing Hints At Economic Boost
Date
10/14/2024 3:19:29 PM
(MENAFN- The Rio Times) The iron ore market saw a positive shift on Monday. Traders responded to news of potential fiscal stimulus from China. This development improved sentiment in the world's largest steel-consuming market.
China's Dalian Commodity Exchange saw January iron ore futures rise by 1.97%. The price reached 800.5 yuan (R$631.59 / $112.78) per ton. Early trading witnessed a jump of over 3%.
In Singapore, the benchmark November iron ore contract increased by 1.4%. It reached $107.7 (R$602.12) per ton. Steel prices on the Shanghai Futures Exchange also gained ground.
Rebar and hot-rolled coil both rose by about 1.36%. Wire rod advanced 0.96%, while stainless steel saw a 0.32% increase. These gains reflect growing optimism in the sector.
On Saturday, China promised a new package of fiscal policies. This announcement boosted sentiment across various commodity markets, including steel. Chinese consultancy Mysteel reported this positive trend.
As steel product prices strengthened, more Chinese steel mills became profitable. The average operating rate among 87 steel mills increased by 1.85 percentage points between October 4 and 11.
However, some concerns linger. Signs of deflation in China and unclear local stimulus measures cloud demand prospects. Consumer inflation unexpectedly fell in September, while producer price deflation worsened.
These economic indicators put pressure on Beijing to implement more stimulus measures quickly. The goal is to revive sluggish demand and stabilize economic activity.
Beijing announced plans for more "countercyclical measures" this year. Yet, investors remain uncertain about the scale and timing of the proposed stimulus package.
In short, the iron or market continues to watch China's economic moves closely. Any concrete steps towards stimulus could further boost commodity prices and market sentiment.
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