Iron-ore swaps gained the most in two weeks as Chinese steel output advanced and the cost of physical cargoes halted a plunge.
February contracts rose 3 percent to $138 a dry metric ton as of 12:42 p.m. in London, according to GFI Group Inc. That’s heading for the biggest increase since Jan. 3, based on data from SGX AsiaClear, the largest clearer of the derivatives.
Chinese crude steel output rose 2.3 percent in the first 10 days of January to 1.944 million tons daily, the official Xinhua News Agency said today, citing the China Iron & Steel Association. Iron ore with 62 percent iron content at the port of Tianjin was unchanged at $145.40 a ton today after dropping 8.3 percent in five sessions, according to The Steel Index Ltd.
“The fall was already priced in by the market,” Ben Goggin, a broker of iron-ore swaps at ICAP Plc in London, said by e-mail today. “Today the spot market was much quieter and there was some positive news, and buyers came back into the market.”
The benchmark price for physical iron ore jumped as much as 37 percent since December to a 14-month high on Jan. 8, Steel Index data show. China will import 770 million tons in 2013, 3.6 percent more than last year, Li Xinchuang, president of China’s Metallurgical Industry Planning & Research Institute, said at a conference sponsored by Bloomberg Industries in New York yesterday. That’s the slowest growth since 2010, customs data show.