Iron ore futures rose on Friday, reversing earlier weakness and on track for weekly gains, as additional signs of a stabilising Chinese economy underpinned sentiment already buoyed on extra stimulus for the world’s biggest steel producer.The most-traded January iron ore on China’s Dalian Commodity Exchange ended daytime trade 2.1% higher at 889.50 yuan ($121.57) per metric ton. It has gained about 4% this week.
On the Singapore Exchange, the steelmaking ingredient’s benchmark November contract climbed 1.5% to $118.80 per ton by 0700 GMT,logging its first weekly gain in six weeks.
Profits at China’s industrial firms extended gains for a second month in September, adding to signs of a stabilising economy as the authorities launched a burst of supportive policy measures.
Beijing earlier this week approved additional fiscal support for China’s economic recovery.
This week saw increased price volatility for iron ore, as concerns persist about Chinese steel mills further curbing production to comply with emission control protocols, especially during winter months.
The northern Chinese city of Tangshan, China’s top steel production hub, will launch a level-2 emergency response from Friday amid a forecast of heavy air pollution.

China’s deepening property sector crisis also kept traders cautious.

Despite many stimulatory measures, the sector is still grappling with debt and sluggish demand. This keeps steel demand prospects weak, increasing risk for narrowing profitability for steel producers,” ANZ commodity strategists said in a note.
While restocking of iron ore could provide a near-term support, we see the risk of another leg down for prices breaking below $100/t by the year end.”
Other steelmaking ingredients on the Dalian exchange also reversed earlier losses, with coking coal DJMcv1 and coke DCJcv1 up 2.7% and 2.2%, respectively.
Shanghai steel benchmarks rose, with rebar SRBcv1 up 1.5%, hot-rolled coil SHHCcv1 up 1.6% and wire rod SWRcv1 up 0.5%. Stainlesss steel SHSScv1 shed 0.3%.