Iron ore climbed higher on Monday, with Chinese futures pointing to further gains to come.
According to Metal Bulletin, the spot price for benchmark 62% fines rose by 0.92% to $55.68 a tonne, extending its gain this year to 27.8%.
The gains followed another government enforced curtailment of heavy industry in Tangshan, a key steel producing city in China.
“Tangshan’s local government has ordered production cuts for the second half of July to ensure good air quality ahead of activities to commemorate the 40th anniversary of the Great Tangshan earthquake, which struck the city on July 28, 1976,” said Metal Bulletin, citing local media reports.
“Sinter plants in Tangshan are to cut production by 50% over July 12-24, and implement total suspensions over July 25-31. Rolling mills are required to halve production throughout July 12-31.”
Suggesting that the gains in the spot market may continue on Tuesday, Chinese iron ore futures continued to push higher in overnight trade.
The most actively traded September 2016 contract on the Dalian Commodities Exchange added 0.47%, closing the session at 429.5 yuan.
Trade in Dalian will resume at 11am AEST.
On Wednesday Chinese international trade figures for June will be released. That will be followed by Q2 GDP, along with industrial output, fixed asset investment and retail sales figures, which will be released on Friday.