Iron ore futures in China jumped to a three-week high on Thursday, tracking gains in steel prices, even as appetite for spot cargoes was limited ahead of a week-long holiday in the top consumer. Chinese markets will be shut Oct. 3-7 for the National Day holiday.
The most-active iron ore for January delivery on the Dalian Commodity Exchange climbed as much as 4.5 percent to 426.50 yuan ($64) a tonne, its strongest since September 6. The contract later curbed gains to close 1.4 percent higher at 413.50 yuan. On the Shanghai Futures Exchange, construction steel product rebar rose as much as 2.6 percent before ending flat at 2,273 yuan a tonne.
Iron ore's gains were largely driven by steel, said Wang Di, analyst at CRU consultancy in Beijing. "We don't see too much change in fundamentals. It's the pre-holiday period and I think buyers have almost completed their restocking," said Wang. Wang expects demand for the steelmaking raw material to remain firm after China's holiday, with steel production staying high.
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