Iron ore futures rise on restocking demand and stimulus hopes

Iron ore futures climbed on Friday, supported by restocking activity and anticipation of further economic stimulus.

Chinese steel mills increased their iron ore inventories to prepare for potential disruptions during the winter months. Meanwhile, inventories at major Chinese ports saw a weekly decline, though they remain at elevated levels, which continues to put pressure on the market.

Market optimism was further fueled by expectations surrounding the Central Economic Work Conference, scheduled for December. This annual meeting, where China’s leadership sets the country’s economic priorities, has raised hopes for additional policy measures to bolster growth. Such speculation has grown amid concerns over external risks, including potential trade tensions following the U.S. elections, with markets looking to Beijing for countermeasures.

Economic data also painted a mixed but improving picture. Industrial profits in October fell by 10pct YoY, a sharp improvement from the 27.1pct decline in September, marking the first signs of recovery since July. The rebound was driven by a revitalized manufacturing sector, buoyed by a series of stimulus measures introduced in recent months, according to the National Bureau of Statistics (NBS).

Iron ore futures on the Dalian Commodity Exchange rose by 1.14pct to 797.5 yuan (USD 110) per ton. The main iron ore contract also posted nearly 3 pct weekly gain.

However, both coke and coking coal futures declined slightly, falling by 0.24pct to 1,875.5 yuan (USD 259) and 1,245.5 yuan (USD 172) per ton, respectively.

In the Shanghai Futures Exchange, rebar futures advanced by 0.48pct to 3,318 yuan (USD 458) per ton, while HRC futures gained 0.63pct to 3,489 yuan (USD 481) per ton. Wire rod futures also edged up by 0.53pct to 3,614 yuan (USD 499) per ton. Stainless steel futures, however, posted a decline, settling 0.46pct lower at 13,005 yuan (USD 1,794) per ton.

1 USD / 7.24 yuan