Prices for iron ore have increased sharply today, Monday, December 9, following a surge in futures prices in China. Iron ore fines with 62 percent content have been available at $93.5/mt CFR, up $4.9/mt from Friday. Prices for Brazilian iron ore with 65 percent Fe have increased by $4.5/mt to $104.9/mt CFR over the same period, SteelOrbis has learned.
Iron ore prices have gained mostly on the back of improved sentiment as futures prices at Dalian Commodity Exchange have surged by 5.2 percent or RMB 34/mt ($4.8/mt) to RMB 686.5/mt ($97.5/mt) on Monday. At the same time, there have been no deals reported on the trading platforms over the day.
China's central government announced its intention to maintain economic growth levels by boosting infrastructure development. According to J.P. Morgan's chief China economist Zhu Haibin, macroeconomic indicators will rebound in the first half of 2020 due to higher manufacturing and infrastructure investment. The growth rate for infrastructure investment is expected to reach 5-6 percent next year as the government is increasing issuance of special local government bonds.
Lower import iron ore data have also supported positive sentiments. In November, imports decreased by 2.38 percent month on month to 90.652 million mt despite higher crude steel production in China. Also, shipments from Brazilian miner Vale are expected to be lower in the first quarter of 2020, as SteelOrbis reported earlier.