Iron ore soars to one-week high on China stimulus

Iron ore futures in Dalian and Singapore climbed on Monday to their highest levels since May 23, extending a relief rally spurred by easing COVID-19 curbs in top steel producer China and government efforts to shore up the battered domestic economy, reports Reuters.

The most-traded September iron ore on China's Dalian Commodity Exchange jumped as much as 3.9 per cent to 887.50 yuan ($133.16) a tonne, before ending daytime trade at 878 yuan, up 2.8 per cent.

On the Singapore Exchange, the steelmaking ingredient's most-active June contract rose 1.5 per cent to $135 a tonne by 0702 GMT. It hit a one-week high of $135.30 earlier in the session.

"The moment the iron ore market has been waiting for has finally arrived, with falling national caseloads and a telegraphed reopening of Beijing and Shanghai," said Atilla Widnell, managing director at Navigate Commodities in Singapore.

From a March 7 peak of $163 a tonne, the spot price of benchmark 62 per cent-grade iron ore bound for China has fallen to $133.50, as of Friday, SteelHome consultancy data showed.

Authorities in China's commercial hub of Shanghai will cancel many conditions for businesses to resume work from Wednesday, easing a city-wide lockdown that has added to a slowdown in the world's second-biggest economy.

Shanghai officials have also announced an action plan to boost the economy, including accelerating the issuance and use of local government bonds, and asking banks to renew loans for small- and medium-sized enterprises.