The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) was up 1.02percent at 795 yuan (USD111.57) a metric ton, as of 0301 GMT. The contract is set to post weekly gains of 1.4percent, if the current momentum persists.
The benchmark October iron ore on the Singapore Exchange traded 0.51percent higher to USD105.45 a ton, and poised for a 1.36 percent 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 15percent.
