FX.co ★ Iron Ore Rises on China Demand Hopes

Iron ore futures surged past CNY 790 per ton on Thursday, making a slight recovery from a one-month low. This shift comes as anticipation mounts that Chinese steel producers will ramp up their restocking efforts following recent price dips and resume operations post-maintenance. Market participants are optimistic that China’s hot metal production will bounce back after experiencing a decline of approximately 7,000 tons in the past week, as several blast furnaces were under maintenance with plans to restart activities in the coming week. However, there remains a cautious outlook concerning potential environmental protection measures and safety inspections by the Chinese government ahead of the Lunar New Year holiday, which may dampen steel production and consequently reduce demand for iron ore and other raw materials. Additionally, the market is keeping a close watch on possible disruptions in shipments and production tied to the monsoon and rainy seasons in the Southern Hemisphere, adding further complexity to the immediate supply landscape.