Chinese iron ore futures advanced on Thursday and were on course to rise by over 50% this year, their second straight annual gain, supported by supply concerns and China's robust steel demand despite the coronavirus pandemic-led disruption.
"Impact from the pandemic (on iron ore) was not as pessimistic as market expected," said Zhuo Guiqiu, analyst with Jinrui Capital. "The big jump came after Vale lowered its shipments expectations and a robust Chinese steel demand in the fourth quarter."
The most actively traded iron ore futures on the Dalian Commodity Exchange, for May delivery, rebounded from two consecutive sessions of losses and inched 0.7% higher to 983 yuan ($150.40) a tonne as of 0330 GMT.
The recent surge was beyond market expectations and iron ore prices next year would be decided more by the demand side, Zhuo added.
Dalian iron ore prices soared 28% in the fourth quarter.
Steel futures on the Shanghai Futures Exchange also gained in 2020.
Construction steel rebar rose 2.0% to 4,332 yuan a tonne, while hot rolled coil advanced 2.3% to 4,509 yuan a tonne, sending their annual growth to 21.4% and 25.5%, respectively.
Shanghai stainless steel futures, for May delivery, were unchanged from the previous session at 13,345 yuan a tonne. Coking coal futures on the Dalian bourse dipped 0.4% to 1,643 yuan per tonne. Coke inched down 0.1% to 2,790 yuan a tonne.
