Prices of iron ore futures climbed on Friday, and logged weekly gains, supported by expectations of stronger steel prices and improved market fundamentals.

The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) TIO1! was up 1.02% at 795 yuan ($111.56) a metric ton. The contract ended the week 1.6% higher.

The benchmark October iron ore (SZZFV5) on the Singapore Exchange traded 0.75% higher to $105.7 a ton, as of 0217 GMT, and is poised for a 1.6% weekly gain.

After declining steadily over the past two months, Chinese steel prices are expected to rise in October, supported by improved market fundamentals and anticipated implementation of stronger economic stimulus policies by the central government, according to consultancy Mysteel’s chief analyst.

Despite stockpiling iron ore prior to the Golden Week holiday, transportation restrictions are preventing steel mills from maintaining adequate raw material inventories, which could force them to reduce production, said Chinese broker Hexun Futures.

Russia is considering a moratorium on bankruptcies in the metals industry, as the sector grapples with tepid demand, high interest rates, and a strong rouble, with one of its top steelmakers estimating that demand has fallen by up to 15%.

Russia is the world’s fifth-largest steel producer, with output of about 71 million tons in 2024.

Broadly, Chinese holidaymakers’ average spending during the Golden Week holiday fell to a three-year low, as weak consumption continues to weigh on the world’s second-largest economy.

The downturn is driven by pressures from U.S. trade policies, extreme weather, intense price competition in domestic markets, and persistent weakness in the property sector.

Other steelmaking ingredients on the DCE gained ground, with coking coal NYMEX:ACT1! and coke (DCJcv1) up 1.22% and 1.86%, respectively.

Steel benchmarks on the Shanghai Futures Exchange were mixed. Wire rod (SWRcv1) was flat, while rebar RBF1! rose 0.52%, and hot-rolled coil EHR1! climbed 0.37%. Stainless steel HRC1! dipped 0.16%.
Source: Reuters