Iron Ore Rises With Copper on China’s Waning Virus Outbreak
Iron ore headed for its highest close in three weeks as industrial materials gained on hopes that China’s easing of virus curbs will herald a demand recovery. Beijing relaxed movement restrictions in several districts as new local cases in the capital declined to only 12 on Saturday, while authorities in Shanghai said all manufacturing activity could restart from Wednesday. These are the strongest signs yet that China is exiting a period of punishing restrictions that have battered commodities demand. Iron ore fell in five of the past eight weeks with sentiment whipsawed by new flare-ups and government attempts to shore up the economic outlook. Prices “remain beholden” to government directives, Vivek Dhar, commodities analyst at Commonwealth Bank of Australia wrote in a note, and he expects lockdowns to ease off enough by the second half of the year “to enable policy support measures to boost China’s demand impulse”. There was another positive sign from the steelmaking hub of Tangshan, where data showed blast-furnace usage rising in the week to May 27. Utilization rates are on course for a third monthly increase with operations holding steady despite lockdowns, drawing down on iron ore stockpiles.
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