Iron ore rose — after dropping 12% in a four-day run of declines – following a report that a group of steel mills in southwestern China are trying to stabilize the market.
Steel producers in the region held a meeting over the weekend to discuss measures, including limiting output, according to a statement from the Wechat account of Sichuan Metallurgical Group, one of the companies that attended. While cutting production would damp demand for iron ore, improving the financial situation at mills might be good for the steel-making ingredient in the longer term.
Iron ore has fallen by more than a fifth over the last month on high steel inventories and weak margins at mills due to a virus-induced reduction in Chinese economic activity.
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