Iron ore prices continue to rise strongly

Iron ore futures in Singapore rose more than 50 percent in just six weeks, driven by the improvement in the demand outlook. Chinese authorities support banks' funding of buyers of struggling real estate development companies' projects and are urging financially sound real estate companies to make such purchases. In addition, Chinese banks have lowered their borrowing costs for the first time in 20 months, and the People's Bank of China has reduced the amount of money banks must hold as reserves to increase liquidity.

Prices are also supported by the fact that Chinese steelmakers increased their output after tight restrictions on production volumes earlier this year.

In a note to customers, Holly Futures said, "The improvement in the real estate and infrastructure outlook has strengthened expectations that steel mills will resume production. While the start of stocking for the winter period has also supported the demand for iron ore, the controls to prevent environmental pollution are still continuing."

Iron ore prices in Singapore rose 4% to $128.20 per ton after reaching a high of $129.45 per tonne in mid-October.Futures in China's Dalian market rose 4.2 percent, while rebar and hot-rolled coil prices fell.