Iron ore resumes rally after Chinese New Year on demand optimism
Dalian iron ore futures extended gains Monday following the week-long Lunar New year holiday in China, on optimism around demand prospects for the world's top steel producer.
According to Reuters, the most-traded May iron ore contract (SCO:COM) on China's Dalian Commodity Exchange ended daytime trade +2% to 873.50 yuan/metric ton ($129.40) after hitting a contract-high 890 yuan, and the March iron ore contract on the Singapore Exchange traded +1.1% at $127.80/to after hitting a session-high $130.55/ton.
In the spot market, benchmark 62%-grade iron ore (TIOC:COM) was trading at $128.50/ton, the highest since June, based on SteelHome consultancy data.
Potentially relevant tickers include (RIO), (BHP), (VALE), (OTCQX:FSUMF), (OTCPK:GLCNF), (OTCPK:GLNCY), (OTCQX:AAUKF), (OTCQX:NGLOY)
Government data showed Lunar New Year holiday trips inside China increased 74% Y/Y after authorities scrapped COVID-19 travel curbs, and the central bank said Sunday it would roll over three lending tools to increase support for targeted sectors of the economy.
Rio Tinto and Vale said recently they will refrain from adding production this year; Rio has forecast little change in iron ore shipments and higher costs for 2023, while Vale sees flat output of 310M-320M tons.