Iron ore futures rallied on
Wednesday to their highest in multiple months, boosted by hopes
of improving demand in top consumer China following Beijing’s
pledge of easing monetary policy this year.
The most-traded May iron ore contract on China’s Dalian
Commodity Exchange (DCE) closed morning trade 3.52%
higher at 823.5 yuan ($117.90) a metric ton, its highest level
since July 23.
The benchmark February iron ore on the Singapore
Exchange was 1.67% higher at $108.25 a ton as of 0322 GMT, after
touching its highest since February 24 at $108.6 earlier.
China’s central bank said on Tuesday that it would cut the
reserve requirement ratio and interest rates in 2026 to keep
liquidity ample, and continue to implement appropriately loose
monetary policy.
Hopes of rate cuts by Beijing in coming months boosted broad
sentiment in the ferrous market, underpinning price rallies
across the market, said analysts.
Supporting prices of the key steelmaking ingredient was also
the expectation of a raft of restocking by Chinese steel mills
with low in-plant inventory ahead of the Lunar New Year in
February.
Other steelmaking ingredients on the DCE likewise surged,
with coking coal and coke up 7.98% and 6.85%,
respectively.
Steel benchmarks on the Shanghai Futures Exchange gained
ground. Rebar rose 2.26%, hot-rolled coil
strengthened 1.94%, wire rod firmed 1.12% and stainless
steel jumped 4.39%.