Iron ore is in demand as new infrastructure projects paid for by stimulus get underway
The iron ore price has hit a one-year high on expectations of a market deficit for 2020, as Chinese demand sucks in supply.
Iron ore futures rose 3.2% to US$112 per tonne on the Singapore Exchange on Monday, the highest level they’ve traded at since August 2019, according to data provided by Bloomberg.
The price strength comes as China posted strong PMI numbers for July, showing significant growth in its manufacturing sector, and reflecting too a willingness on the part of government to spend on big projects as part of a general effort towards economic recovery in the wake of the coronavirus crisis.
Accordingly, Chinese steel mills continue to build-up stockpiles of iron ore, which have risen for the seventh consecutive week, although their overall holdings are still quite low and only represent 30 days of consumption…Full Story