The most-traded iron ore contract on China’s Dalian Commodity Exchange (DCE) closed daytime trade up 0.52 percent at 780 yuan (USD110.79) a metric ton, posting a weekly increase of 2.6 percent – its biggest weekly gain since late October.
The benchmark January iron ore on the Singapore Exchange was 0.17percent lower at USD104.7 a ton, as of 0701 GMT, but poised for a weekly rise of 2.7 percent. It touched its highest since November 27 at USD105 earlier in the session. Steel mills are expected to ramp up buying of spot cargoes in the coming weeks to replenish volumes to meet consumption needs during the Lunar New Year holiday over February 15-23.
Also supporting prices was the persistent structural tightness for medium-grade iron ore, after a ban on two grades of BHP ore following a negotiation dispute between the miner and China’s state-owned iron ore buyer.