Iron ore price forecasts rose to $140 per ton on expectations of increased investment in China's urban development. November futures in Singapore rose to $134 a ton as iron ore stocks in China fell to the lowest level in seven years.
China is forecasting growth in the real estate market with a forecast growth of 8% for 2024. Significant construction activity is planned for the next five years, targeting the development of about one billion square meters of land.
Some analysts recommend buying iron ore in the market dips leading up to the Chinese New Year. Historical data expects an average increase of +21.1%, +14.4% and +18.3% over the last five, ten and fifteen years, respectively.
Fortescue Metals Group Ltd shares reflect this trend, trading at levels close to their peaks when iron ore prices previously hit significant highs.
On the other hand, the National Development and Reform Commission (NDRC) expressed concerns that speculative trading could potentially lead to excessive price inflation. The Commbank also urged caution, noting that past support measures have failed to prevent the bankruptcy of real estate companies such as Country Garden.
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