Chinese commodity futures are exploding higher yet again on Monday, continuing to build on the remarkable gains seen during Friday’s night session.
And iron ore futures briefly hit limit 8% up for the session, leaving them on track to close at the highest level on record.
They’re currently sitting up 7.88% at 657 yuan, above the previous closing high of 652.5 yuan struck on December 12 last year.
With the benchmark spot price just 3.63% below the multi-year high of $83.58 a tonne struck on December 12 last year, the move in futures suggests there’s a chance that the spot price may also scale new heights when Metal Bulletin releases its daily Iron Ore Index later in the session.
Here’s the scoreboard approaching the half time break in China.
While iron ore futures traded on the Dalian Commodities Exchange is the standout performer on Monday, there’s been other significant gains recorded across coking coal, coke and rebar futures.
It’s the gain in the latter that appears to be fueling today’s gains, with the May 2017 rebar future on the Dalian Futures Exchange surging higher after underperforming on Friday evening.
There’s been no obvious catalyst to explain the sudden surge in futures, although price have recently been driven higher by additional announcements over steel capacity cuts in China, along with elevated levels of speculative trading.