Iron ore futures soared to their highest levels in three months on Monday, driven by traders’ optimism following China’s latest support measures for its struggling real estate sector, which consumes a significant volume of iron ore.
On the Dalian Commodity Exchange (DCE), the most-traded September iron ore contract (DCIOcv1) rose by 1.6%, reaching 899 yuan ($124.33) per metric ton at the midday break. Earlier in the session, the contract had surged by as much as 2.4% to 906 yuan, marking its highest point since 20 February.
Last Friday, China unveiled “historic” measures to stabilise its property sector. These included the central bank providing an additional 1 trillion yuan in funding, easing mortgage rules, and local governments committing to purchase “some” apartments.
Iron ore and steel are crucial materials in the construction industry, with China being the world’s largest consumer of these commodities.
Meanwhile, the benchmark June iron ore contract (SZZFM4) on the Singapore Exchange was up by 1.8%, trading at $119.45 per ton as of 0326 GMT.
Alien Metals Ltd (LON:UFO) is a global minerals exploration and development company that will shortly make the transition to iron ore producer. The company was formed from Arian Silver in late 2018, retaining some of the companies more valuable Mexican projects before embarking on an acquisition led strategy, headed up by an excellent geological team and targeted entirely on Western Australia.