On the last trading day before the holiday, domestic iron ore futures rose sharply and closed.
The main (May) contract of iron ore futures of Dashang institute rose 7.59% to 829 yuan / ton, refreshing the high point since October last year. In mid-November last year, iron ore futures bottomed out after a nearly 5-month decline, with the lowest offer approaching 500 yuan / ton, and then prices rose all the way, especially since this year.
In this regard, Reuters analyzed on the 26th that concerns about insufficient supply supported the rally. The report quoted major miners BHP Billiton, Rio Tinto and FMG Group as warning that as Australia faces a surge in Opichron cases, labour shortages will cause disruption and both Dalian and Singapore's benchmark iron ore futures contracts are expected to achieve weekly gains. Supply concerns boosted iron ore prices. Iron ore prices rebounded this month as China stepped up monetary easing.
In response to the above situation, the Reform Commission issued a document on the 28th that recently, the iron ore market price has risen sharply, and there have been many abnormal fluctuations during the period. Relevant parties believe that the current iron ore market supply and demand is generally stable, domestic inventories are at a high level for many years, and recent prices have risen too quickly, and there is a speculation component. The National Development and Reform Commission is highly concerned about the changes in the price of the iron ore market, and will conduct in-depth investigations with relevant departments, strengthen supervision, severely crack down on illegal acts such as spreading false information, price gouging, malicious speculation, etc., and study and take further effective measures to effectively ensure the stable operation of iron ore market prices.
It is worth noting that the global iron ore giant Rio Tinto Group just released the 2021 production and operation report about 10 days ago, emphasizing that its development prospects are closely related to China, the world's second largest economy. Thanks to China's economic stimulus policies, Rio Tinto mitigated the disadvantages caused by poor management in other markets in 2021.
In its latest report, Rio Tinto said China has taken positive action to boost domestic economic activity, especially the interest rate cut announced by the Chinese government on Monday as the latest in a series of economic stimulus policies over the past few months. Rio Tinto CEO Jacob Stusholm also expressed support for China's economic stimulus policy to avoid a global recession.
In December 2021, Rio Tinto announced that outgoing Canadian Ambassador to China, Damin Bao, will join Rio Tinto's board of directors in April 2022 and serve as chairman the following month, filling the vacancy left by Thompson's resignation. Bao Damin was appointed ambassador to China after relations with Canada deteriorated due to the deterioration of the Meng Wanzhou incident, and was appointed by Canadian Prime Minister Trudeau as ambassador to China. Rio Tinto said it hopes that Bao Damin, who will soon join Rio Tinto, will use its understanding of China, the world's largest market, to enhance Rio Tinto's export of iron ore and other resources to China.
Wang Guoqing, director of the China Lange Steel Research Center, analyzed the media that China is the largest export market for Australian iron ore, and more than half of Rio Tinto's global revenue comes from China, and there is no substitute for the Chinese market space and the absolute amount of imports. Therefore, Rio Tinto deserves to look for opportunities to further expand the market in China's economic development, and China should also appropriately develop more strategic resource import channels.
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