BEIJING: Iron ore futures prices climbed on Monday as the world’s two largest economies agreeing to a deal to slash reciprocal tariffs and a 90-day pause on measures lifted investor sentiment.
The United States and China said on Monday they have agreed a deal to slash reciprocal tariffs as Washington and Beijing seek to end a trade war that has disrupted the global economy and set financial markets on edge.
Speaking after talks with Chinese officials in Geneva, US Treasury Secretary Scott Bessent told reporters the two sides had agreed on a 90-day pause on measures and that tariffs would come down by over 100 percentage points to 10%.
The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) closed daytime trade 3.16% higher at 718.5 yuan ($99.63) a metric ton, the highest since May 7.
The benchmark June iron ore on the Singapore Exchange climbed 2.9% to $99.75 a ton as of 0713 GMT, approaching the key psychological level of $100.
The magnitude of the tariff reductions somewhat beat expectations and bolstered sentiment, said analysts and traders.
Relatively stable demand, underpinned by mills’ enthusiasm to sustain operations lured by profits, also supported ore prices.
The average daily hot metal output - typically used to gauge iron ore demand - nudged 0.1% higher to 2.46 million tons as of May 8, the highest since October 2023, a survey by consultancy Mysteel showed.
Prices have been swinging back and forth with concerns mounting and subsiding over US tariff hikes and talks on China’s crude steel output cut to dampen demand for the key steelmaking ingredient.
Seaborne ore prices have fallen by 11% from the year-to-date peak of $107 a ton in February, consultancy Steelhome data showed.
Other steelmaking ingredients on the DCE reversed course to shrug off earlier weakness, with coking coal and coke up 0.68% and 0.75%, respectively.
Steel benchmarks on the Shanghai Futures Exchange gained ground. Rebar added 1.52%, hot-rolled coil advanced 1.51%, wire rod jumped 1.39% and stainless steel rose 1.34%.
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