Singapore - Iron ore futures fell on Friday but ended the week higher as investors weighed the latest pledges from China, the world's biggest consumer, for more stimulus to prop up its ailing economy.
The top-traded January iron ore contract on China's Dalian Commodity Exchange (DCE) ended the day's trading down 1.12% at 797.0 yuan ($109.50) per tonne. The January iron ore price on the Singapore Exchange fell 2.13% to $103.8 per tonne and rose 2.65% since the beginning of the week.
“Markets were extremely disappointed by the lack of concrete data from the China Central Economic Work Conference, given such a promising start to the week from the... Politburo,” said Atilla Widnell, managing director of Navigate Commodities. Widnell added that the disappointment came despite Chinese officials having signaled policy guidelines would be unveiled around March 2025.
Beijing on Thursday vowed to widen its budget deficit, increase bond issuance and ease monetary -credit policy, preparing for escalating trade tensions ahead of Donald Trump's second presidency.
The remarks came in the report of the annual Central Economic Work Conference of China's top leaders, held on 11-12 December.
“With China's economic recovery still uneven... it will be difficult for us to see a long-term rise in iron ore prices,” ING analysts said, adding that this will continue until the market sees signs of strong economic recovery and growth.
ING added that ore prices were also being weighed down by high port inventories of more than 150 million tonnes, the highest for this time of year.
