Iron ore futures surged on Monday, reversing earlier losses prompted by US President Trump's tariff threat, driven by a resurgence in demand from China and reduced shipments from major suppliers.
Iron ore futures rallied on Monday, recouping earlier losses triggered by US President Donald Trump's threat to impose a 25% tariff on all steel and aluminum imports. The rebound was fueled by signs of recovering demand in China, the world's largest iron ore consumer, and a decrease in shipments from major suppliers. The most-traded May iron ore contract on China's Dalian Commodity Exchange (DCE) closed the day 0.79% higher at 826.5 yuan ($113.
16) per metric ton, reaching its highest level since December 10, 2024. Meanwhile, the benchmark March iron ore on the Singapore Exchange climbed 0.76% to $107.15 per ton as of 0712 GMT, touching a high of $107.5 per ton earlier in the session.Demand for iron ore, a key ingredient in steelmaking, showed encouraging signs of recovery. According to consultancy Mysteel's data, the average daily hot metal output, a widely used indicator of iron ore demand, increased by 1.3% from the assessment before China's Lunar New Year holiday break to 2.28 million tons on February 5 among surveyed steelmakers.Adding to the bullish sentiment, shipments from leading suppliers Australia and Brazil dropped by 32% to 18.98 million tons in the week ending February 9 compared to the previous week, as per Mysteel data. This decline helped iron ore prices overcome the initial losses triggered by Trump's trade policy announcement on Sunday, which threatened to escalate tensions and uncertainty in global markets. Other steelmaking ingredients on the DCE traded mixed, with coking coal rising by 0.13% and coke falling by 1.72%. On the Shanghai Futures Exchange, steel benchmarks performed weaker. Rebar lost 0.89%, hot-rolled coil declined by 0.49%, wire rod shed 0.53%, and stainless steel dipped by 0.48%
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