The Solomon Hub, a remote mining site in Pilbara, includes the Firetail, Kings Valley and Queens Valley mines, which together have an annual production c -acity of 75 million tons of iron ore.
Iron ore for January delivery to China’s Dalian Commodity Exchange ended day trading 5.4% higher at 721.50 yuan (111.58) a ton after rising 758 yuan, the highest since Sept. 8 earlier Day.
According to Fastmarkets MB, the 62% Fe fines imported into northern China switched hands as a benchmark at $ 119.23 per ton, up 4.3% from its closing on Wednesday.
This week’s gains in iron ore futures markets also reflected the rebound in spot prices in leading steelmaker China, largely aided by the replenishment of demand ahead of the Golden Week holidays starting October 1st.
However, Dalian iron ore posted its first quarterly loss in two years and its third straight monthly decline after falling 42% from its record high in mid-May.
Caution has prevailed in the Chinese metal markets in light of power restrictions and bottlenecks that have led to production cuts.
“The power shortage means that many steel mills have to cut production,” said Daniel Hynes, chief raw materials strategist at ANZ, citing industry data that showed a 7.2% drop in production in the first two weeks of September compared to the previous month.
Related: What’s behind China’s power crisis?
Electricity shortages have dampened demand for iron ore, which is already hit hard as China tries to limit steel production to reduce CO2 emissions.
“Downstream stainless steel consumption has been curtailed, particularly in Guangdong Province,” said Fu Zhiwen, an analyst at Huatai Futures.
(With files from Bloomberg and Reuters)