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If you’re waiting for Rio Tinto’s Simandou mine in Guinea to tank the iron ore price – something I’ve been talking about a lot on the HotCopper Wire podcast lately – we’re not seeing it yet.
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Looking at the Singapore-based SGX, the iron ore benchmark Aussie traders (and mines) pay the most attention to, prices are currently fetching 17-month-highs at US$109/tn.
What global iron ore traders are most likely looking at now is the latest raft of economic stimulus announcements to come from China for 2026.
While the CCP has been using various mouthpieces to reassure markets on Chinese economic stimulus ever since the country lifted COVID lockdowns three or so years ago, little has proven meaningful in the long term.
However, as far as you can interpret the SGX iron ore price as a sentiment indicator for Chinese policy, it’s clear this fresh push for stimulus measures in the new year of 2026 has hit different. That may be because the Chinese government has advised of its plans to cut interest rates, something perhaps more immediately understandable for investors everywhere in the current climate.
But the upside also comes on the back of what is ultimately a global rally for metals; gold, silver, and copper have all come to mainstream attention over the last twelve months, and particularly in the last three, as madness on metals markets has pushed gold to US$4,500/oz; silver to US$80/oz and copper to over US$13,000/tn.
But it’s not just limited to that. GFEX lithium carbonate benchmarks in China have also translated into solid runs for Australian lithium companies, especially PLS Group (ASX:PLS), which is nearly back to being worth $5. Strong attention for PLS is likely underpinned by the fact it was, until fairly recently, a fairly good dividend-payer.
Whether the same enthusiasm can last for iron ore remains to be seen; the big thing to look out for will be updates around China’s construction sector broadly, given it’s a major source of demand for Australian iron ore. Simandou, for now, remains a fairly sleepy giant – but still something to keep firmly in the front of mind.
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