MANILA: Iron ore futures in Dalian and Singapore climbed on Monday to their highest levels since May 23, extending a relief rally spurred by easing COVID-19 curbs in top steel producer China and government efforts to shore up the battered domestic economy.

The most-traded September iron ore on China’s Dalian Commodity Exchange jumped as much as 3.9% to 887.50 yuan ($133.16) a tonne. On the Singapore Exchange, the steelmaking ingredient’s most-active June contract rose as much as 1.7% to $135.30 a tonne.

“The moment the iron ore market has been waiting for has finally arrived, with falling national caseloads and a telegraphed reopening of Beijing and Shanghai,” said Atilla Widnell, managing director at Navigate Commodities in Singapore. From a March 7 peak of $163 a tonne, the spot price of benchmark 62%-grade iron ore bound for China has fallen to $133.50, as of Friday, SteelHome consultancy data showed. Authorities in China’s commercial hub of Shanghai will cancel many conditions for businesses to resume work from Wednesday, easing a city-wide lockdown that began some two months ago.

China’s tough ‘zero-COVID’ policy has bruised its economy, as stringent lockdown measures hit employment, consumer spending and exports. Shanghai officials have also announced an action plan to boost the economy, including accelerating the issuance and use of local government bonds, and asking banks to renew loans for small- and medium-sized enterprises. But a meaningful rebound maybe still be months away.

“Phased reopenings are unlikely to bring an immediate V-shaped economic recovery, given that it will be slow, steady and cautious to prevent a relapse,” Widnell said. Construction steel rebar on the Shanghai Futures Exchange rose 1.1%, while hot-rolled coil gained 0.9%. Stainless steel advanced 1.8%. Dalian coking coal climbed as much as 5% and coke jumped 4.3% to their strongest levels since May 23.