The iron ore price has extended its stunning rally, pushing to a fresh six-month high, with indications that even more gains could be ahead.
Iron ore added 1.1 per cent to $US63.80 a tonne overnight, according to the Steel Index, from $US63.10 in the previous session.
The commodity is at its highest point since April 29, when it settled at $US65.20.
Dalian iron ore futures are also pointing higher, suggesting the commodity could continue to defy gravity even after a winning streak that has seen it fall only once in the last 16 sessions.
But the rise did little to inspire investors in Australia’s mining giants in London trade, where BHP Billiton shares gained just 0.1 per cent and Rio Tinto added 0.3 per cent.
Iron ore has had a boost from surging prices for steelmaking ingredient coking coal, a drop in major producers’ shipment forecasts and speculation on Chinese exchanges.
The key export’s strength is welcome news for Canberra, given the sensitivity of federal government revenues to the iron ore price.
Hopes of improved demand, given China’s large-scale stimulus plans announced this year, have been supporting prices.
Analysts still expect the commodity to drop back into the low $US50s or $US40s, but have been repeatedly proved wrong since iron ore reached a trough below $US40 last December and spent much of 2016 seemingly defying gravity.
More supply is still set to come online from the Roy Hill project and new developments by Rio Tinto and Vale, adding to a market that is already oversupplied.
come on kevie only been 6 years of nothing
FAS Price at posting:
0.4¢ Sentiment: Sell Disclosure: Held
