By Onome Amuge.
Iron ore futures jumped into bullish territory as the Singapore benchmark vaulting back above the $120 per metric tonne level, underpinned by reports that Rio Tinto halted work at a Pilbara mining site following an incident andChina’s policy support for its economy.
Lending further support, China’s imported iron ore stockpiles at major ports hit a three-year low during the week at 115.92 million tonnes due to higher discharge volumes and fewer new arrivals, according to consultancy Mysteel.
The steelmaking ingredient, however recorded a weekly fall amid persistent concerns about top steel producer China’s troubled property sector.
Benchmark October iron ore on the Singapore Exchange climbed 3.2 per cent at $121.20 per tonne. Though it fell more than 1 per cent during the week after scaling a six-month peak a week prior.
Meanwhile, the most-traded January iron ore on China’s Dalian Commodity Exchange was up 0.9 per cent at 871.50 yuan ($119.38) per tonne.
Traders raised optimism regarding state media reports saying China would continue to break down barriers to market access and increase policy support for the private economy, citing 22 measures issued by the state administration for market regulation.
Rio Tinto, the world’s biggest iron ore producer, said it paused work at a Pilbara site in Australia, after a scrub tree and a one square metre rock fell from the overhang of a rock shelter in an area adjacent to the site. This is expected to slow production as well as supply of the commodity.
However, concerns about China’s crisis-hit property sector have muted iron ore’s rally.
Westpac analysts noted “China’s sluggish growth and investor concerns over the property and financial sectors look set to persist,” said in a note.
In other markets, Shanghai steel benchmarks fell, with rebar losing 0.5 per cent, hot-rolled coil was down 0.4 per cent, wire rod declined 1.8 per cent, and stainless steel plunged 0.7 per cent.