MANILA, March 2 (Reuters) – China’s iron ore futures hit the upside limit on Monday as declining stockpiles at ports indicated steel mills’ improving appetite for the raw material, while expectations grew Beijing will roll out further support for its paralysed economy.
Iron ore on the Dalian Commodity Exchange ended up 5.8% at 653 yuan ($93.70) a tonne, after hitting the daily limit of 6% shortly before the close. Futures on the Singapore Exchange climbed as much as 5.6%.
Factory operations and construction activities in China are gradually resuming after a prolonged Lunar New Year holiday, work stoppages and travel restrictions aimed at containing a coronavirus outbreak.
“Business restarts are progressing, although still at a slow rate,” said Richard Lu, a senior analyst at commodity consultant CRU, in Beijing.
Steel demand may further pick up as expectations rise that China will roll out more stimulus measures after factory activity in the world’s second-largest economy contracted at the sharpest pace on record last month in the wake of the epidemic.