Iron ore prices hit fresh six-and-a-half year highs on Monday on the back of a Chinese construction and factory expansion boom.
According to Fastmarkets MB, benchmark 62% Fe fines imported into Northern China were changing hands for $130.17 a tonne on Monday, up 1.4% from Friday’s peg.
That was the highest level for the steelmaking raw material since mid-January 2014 and brings gains for 2020 to over 41%.
China is expected to set a growth target of 5.5% in its 2021–2025 economic development plan, the fourteenth five-year plan since 1953.
While that’s down from the 6.5% GDP expansion target in the 2015–2020 plan, the relative size of the Chinese economy today translates to more than $750 billion being added to its GDP each year.
That’s the equivalent of expanding by the size of the entire economy of Saudi Arabia, Switzerland or Argentina each year. And most of the economic activity will be directed to steel intensive industries including domestic infrastructure, housing and transport.
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