iron ore jumps 2% to highest level in almost four months

On the back of the Chinese authorities' announcement to support the property sector at a key meeting next week, the highest level of iron ore in almost four months rose to the highest level in almost four months.

The futures advanced in Singapore, increasing a rally from a 45 month low at the end of October to almost 50%. The steelmaking ingredient has been buoyed by a steady stream of policies favorable to the real-estate industry in the world's most populous nation.

It's expected that the property sector, good for 40% of China's steel consumption, will get more support at the Central Economic Work Conference next week, where policy makers will discuss goals for the new year. The authorities will try to reverse the downward trend in the sector and resume normal operations, according to a person familiar with the matter.

Citigroup Inc. said there was scope for iron ore to rally further due to positive sentiment on China's shift away from Covid Zero and the government's determination to support the property sector. The bank increased its three month forecast to $120 a ton and said prices could climb toward $150 if China announces meaningful credit easing over the next three to six months or the re-opening accelerates.

The Minmetals Futures note said that the reflenishment of iron ore stockpiles is slower than expected. It said that it should keep prices strong in the short term.

Iron ore rose by 2% to $111.25 a ton in Singapore as of 5: 24 p.m. local time, set for a sixth weekly advance. Futures in Dalian climbed by 3.1% and steel rebar and hot-rolled coil advanced in Shanghai.

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