Iron ore prices hold steady on property stimulus hopes

The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 0.06% lower at 886.5 yuan ($122.88) a metric ton.

Prices rose by 2.63% on Monday, the first day of trading since the end of China’s five-day Labour Day Holiday at the start of May. China’s Politburo said in a readout on April 30 that authorities should conduct research on policies and measures to reduce housing inventory in order to prevent and diffuse risk in the real estate market, stoking hopes for further stimulus.

“There will still be a certain increase in demand in the future, and the supply and demand of iron ore will be strong,” analysts from information provider Shanghai Metals Market said in a note.

Market confidence had been increased by higher issuance of special bonds, they said.

A survey by industry consultancy Mysteel showed that hot metal production over the five-day holiday period was up 0.9% from the pre-holiday level to average 2.33 million metric tons per day.