Iron Ore Prices Reach 3-Month High
Iron ore prices have surged to their highest levels in three months, reflecting substantial growth in the market since the end of September, primarily fueled by a recovery in the Chinese economy.
This increase corresponds with the upward trend in the raw iron market amid optimism for a stable Chinese economy, particularly within the real estate sector, as reported by the Arab Iron and Steel Union on its website.
Futures contracts for January delivery of iron ore, the most actively traded commodity on the Dalian Commodity Exchange, peaked at $117.14 per ton between September 30 and October 7. Prices remained steady during China’s peak holiday week.
In Singapore, basic futures prices for November were recorded at $108.20 per ton during this period.
At the end of September, the Chinese government unveiled a new stimulus package aimed at supporting the construction sector. This package included measures such as reducing down payments for home purchases and implementing more favorable lending conditions.
These initiatives have spurred construction activity and increased demand for steel and iron ore, positively influencing the commodities market.
However, despite the optimism generated by the new incentives, “investors remain cautious,” according to the same source, which highlighted those challenges facing the Chinese economy—particularly high levels of developer debt—could lead to instability in iron ore demand in the medium term.