Iron ore futures edged higher on Monday, supported by elevated freight rates and a broader rally in steelmaking inputs, as global energy market volatility continued to influence commodity trade flows.
The most-active May contract on China’s Dalian Commodity Exchange rose 0.86% to 818.5 yuan ($118.46) per tonne as of 0324 GMT. However, the benchmark April contract on the Singapore Exchange slipped 0.26% to $107.95 a tonne.
Market sentiment remained cautious despite firm price support. According to Shanghai Metals Market, iron ore and coke prices held steady amid rising ocean freight costs and a shift toward coal-based energy as oil and gas prices surged during the ongoing Middle East tensions.
At the same time, negotiations between BHP and China’s state-backed China Mineral Resources Group prompted some investors to lock in profits, capping further gains.
On the supply side, iron ore inventories at major Chinese ports declined 0.74% week-on-week as of March 20, according to data from consultancy Steelhome, amid a pickup in hot metal production.
Weather disruptions in Australia also lent support. Severe tropical cyclone Narelle brushed the country’s northeast coast, raising concerns over supply interruptions from key mining regions. Port Hedland, one of the world’s largest export terminals, is forecast to face strong winds this week, according to the Bureau of Meteorology.
Meanwhile, global trade dynamics added another layer of uncertainty. South Africa imposed steep import duties on structural steel from China following findings of dumping. Imports account for roughly 36% of the country’s steel consumption, with China contributing nearly three-quarters of that share, as per the South African Iron and Steel Institute.
Other steelmaking inputs saw sharper gains, with coking coal and coke on the Dalian exchange surging 10.33% and 6.31%, respectively. Steel benchmarks on the Shanghai Futures Exchange also advanced, with rebar, hot-rolled coil, wire rod and stainless steel all posting moderate gains.
Overall, the market remains supported by supply risks and energy-linked demand shifts, though cautious sentiment and profit-taking continue to limit upside momentum.