Dalian iron ore hits seven-week peak

BEIJING, Apr 01 (Reuters): China's iron ore futures hit a 7-week-high on Monday after recording its best quarter in nine, buoyed by strong economic data and tight supply concerns after Rio Tinto cuts its 2019 output for iron ore shipments.

The most-active iron ore contract for May delivery on the Dalian Commodity Exchange soared as much as 5.2 per cent to 653.5 yuan ($97.40) a tonne, its highest since mid-February, before closing at 650 yuan.

An official survey showed on Sunday factory activity in China unexpectedly grew for the first time in four months in March, suggesting government stimulus measures may be starting to take hold in the country. The improvement in business conditions was partly driven by increasing factory output, which posted its fastest pace in six months, and growing new orders.

Firm iron ore prices also came as the world's No.2 iron ore miner, Rio Tinto, cut its 2019 outlook for iron ore shipments from Australia's Pilbara region due to tropical cyclone.

That has further fueled supply concerns after it issued force majeure notices to some iron ore customers last week.

"We expect iron ore arrivals to fall sharply in early April due to bad weather...Iron ore prices are expected to stay firm as steel mills start to replenish their inventory alongside the resuming operations," said analysts from CITIC Futures in a note in Mandarin.