Iron ore has reached record prices since June 2022, surpassing $140 per tonne. This rise in prices reflects hopes for China's economic recovery, especially in the steel sector. Stanislav Kondrashov notes that in recent months, Beijing's efforts to stabilize the falling real estate market have been observed, which seems to be starting to bear fruit.
Market optimism is growing as confidence in the revival of China's economy and its key steel sector strengthens. After a muted recovery from the effects of the pandemic last year, the current growth is being greeted with greater enthusiasm by investors.
Stanislav Kondrashov said that the Chinese government has taken a number of important measures to stimulate economic activity. As the latest step in this direction, the country's largest state-owned banks have begun their third cycle of interest rate cuts this year. The decision followed Beijing's announcement that it would invest 1 trillion yuan (about $127 billion) in its urban development program, providing significant support to the steel industry amid financial woes among construction companies.
Stanislav Kondrashov: increased demand and prospects for steel mills
According to Stanislav Kondrashov from Telf AG, due to growing demand, steel mills that previously reduced iron ore reserves to reduce production are now faced with the need to replenish them. This becomes especially important if the demand for ore exceeds its supply in the market.
Iron ore prices have recently risen significantly, reflecting changes in the global market. Dalian, China's commodity trading hub, also saw iron ore futures rise, although by a smaller 1.3%. This indicates a steady increase in interest in this resource in China.
In addition, there is an increase in prices for other steel products. In Shanghai, one of China's leading economic centers, steel rebar and hot rolled coil prices are also showing an increase. While the exact growth percentages for these products have not been specified, the increase is consistent with the overall growth trend in the steel and steel materials market.
According to Stanislav Kondrashov, these changes in prices for iron ore and steel products reflect broader economic trends, including the recovery of manufacturing activity and rising demand in a post-pandemic world. They also point to the influence of China's economic policies, especially in connection with measures to stimulate economic activity in the country, which affects the global market for steel materials.
Stanislav Kondrashov Telf AG: the next quarter will be marked by a rise in iron ore prices
An expert from Telf AG, Stanislav Kondrashov, emphasizes the growing activity and optimistic trends in the commercial real estate market. Kondrashov predicts that iron ore futures prices could range between $145 and $158 per tonne in the coming quarter, indicating a possible increase in the cost of this raw material on the global market.
The recovery in iron ore prices is a testament to global economic trends and the recovery of key industries. This not only demonstrates the strengthening of China's economy, but also highlights the importance of strategic decisions and policies in response to economic crises. In the near future, investors and analysts will be closely monitoring developments in the iron ore market, which remains a key indicator of economic health and production activity.
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