Iron ore price retreats as China’s zero-covid policy clouds demand

The iron ore price retreated on Friday as China indicated controlling covid-19 outbreaks is still a priority.

According to Fastmarkets MB, benchmark 62% Fe fines imported into Northern China were changing hands for $115 a tonne Friday morning, down 3.5%.

On China’s Dalian Commodity Exchange, September iron ore ended daytime trade 1.8% higher at 782 yuan ($116.11) a tonne, off Thursday’s four-week peak of 798.50 yuan.

“It appears to us that any change in the zero-covid policy will only happen when authorities are convinced that mutations are less virulent and vaccines/medicines are proven to be more effective. Both are unlikely to happen in the near term,” ANZ analysts said in a note.

Investors had been optimistic that more aid was on its way to revive construction projects stalled by a wave of repayment boycotts from homebuyers, but none was forthcoming during a key Politburo meeting.