Iron ore rose to its highest in four months on news that Chinese authorities may further soften their stance on property policies at a key meeting next week.
Futures advanced in Singapore, extending a rally from a 45-month low at the end of October to almost 50%. The steelmaking ingredient has been buoyed by a steady stream of policies favorable to the real estate industry in the world’s most populous nation.
Traders are banking on hopes that the property sector, good for 40% of China’s steel consumption, will see a further easing of policies at the Central Economic Work Conference scheduled for next week, where policy makers will discuss goals for the new year. Authorities will aim to reverse the downward trend in the sector and resume normal operation, according to a person familiar with the matter.
Replenishment of iron ore stockpiles remains slower than expected, Minmetals Futures said in a note. That should help keep prices robust in the short term, it said.
Iron ore rose 1.2% to $110.30 a ton in Singapore by 10:42 a.m. local time, heading for a sixth weekly advance. Futures in Dalian were up 3%. Steel rebar and hot-rolled coil gained in Shanghai.
