Iron ore rises with sentiment lifted by China’s fiscal support promise, nickel rally

SINGAPORE: Iron ore futures rose on Thursday as top consumer China’s promise to lend monetary support to boost lacklustre consumption buoyed sentiment, with the recent rally in nickel prices lending further support.

The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) traded 0.33% higher at 766 yuan ($110.98) a metric ton, as of 0249 GMT.

The benchmark March iron ore on the Singapore Exchange was 0.25% higher at $100.2 a ton.

Investor sentiment was lifted after China’s central bank pledged to lend financial support to boost domestic demand, as industrial overcapitalisation and lacklustre consumption weigh on business confidence and dampen the outlook for growth.

The recent rally in nickel prices also helped boost sentiment for other metals, including iron ore, lending support to prices, said Chinese broker GF Futures.

China’s car sales in January fell at the fastest pace in nearly two years as competition steepened in the cutthroat market where automakers are grappling with fading government subsidies, softening demand and tighter regulations.

Sales at home dropped 19.5% from a year earlier to 1.4 million vehicles, the biggest fall since February 2024, data from the China Association of Automobile Manufacturers showed on Wednesday.

With China’s property sector woes showing little signs of alleviating, demand for steel has largely shifted away from construction to manufacturing, with automobile, appliance and shipbuilding being the fastest growing sub-sectors within the industry.

As of 2025, manufacturing accounts for around 53% of China’s overall steel usage, while construction makes up around 36%, according to data from consultancy Mysteel.

Other steelmaking ingredients on the DCE were mixed, with coking coal up 0.27% and coke down 0.18%.

Steel benchmarks on the Shanghai Futures Exchange were also mixed.

Rebar slipped 0.03% and stainless steel retreated 0.27%, while wire rod gained 0.32% and hot-rolled coil remained unchanged.