Iron ore miners extend gains as cyclone threatens WA ports
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The news: Miners rallied in morning trade on the ASX, boosted by better-than-expected economic data in China, even as key ports in Western Australia were closed off after a cyclone warning in the state's iron ore rich Pilbara region.
The numbers: Iron ore heavyweights Champion Iron (2.7%), Rio Tinto (2.2%), Fortescue (2.2%) and BHP (1.1%) were all trading higher by 11:30am AEDT.
Australia's largest steelmaker BlueScope Steel also climbed 1.8%.
The materials sector, up 0.9%, was the best performing sector as the ASX 200 index rose 0.4%.
Iron ore futures jumped 0.7% to USD101.21 ($163.27) a tonne on Friday, as China's National Bureau of Statistics released a raft of better‑than‑expected data for iron ore's top global consumer.
Iron ore futures are at a four-week high — up 0.28% to USD104.15 in Singapore.
The context: Iron ore stocks were boosted on Friday after China met its 2024 GDP target of 5% growth, with industrial output of 6.2% in December outstripping estimates. Steel output gained almost 12% in December, but contracted by 1.7% for the year.
Meanwhile, Pilbara Ports Authority closed the ports of Dampier, Ashburton, Varanus Island and Cape Preseton West over the weekend, as Tropical Cyclone Sean formed off the coast of Western Australia.
The cyclone, which is forecast to intensify to a potential category 3 strength, also saw the closure of Australia's largest iron ore export hub, Port Hedland, on Saturday, halting shipments from the likes of BHP, Rio Tinto and Fortescue.
Also, earlier today, the federal government announced a $2 billion investment in the aluminium industry as part of its Future Made in Australia strategy. Rio Tinto welcomed the announcement and said the support signalled Australia's potential to be a major supplier of the aluminium needed for the global energy transition.
The sources: Bloomberg, CBA economics research, Rio Tinto media release
