Highlights

Seaborne iron ore futures up 25% on month

62% Fe fines futures contracts trade volume above 400 mil mt

The volume of iron ore 62% Fe fines futures contracts traded on the Singapore Exchange increased 25.41% on the month to around 403.51 million mt in January, the latest SGX data showed. It was also the second time above the 400 million mt level in the past three years, according to S&P Global Commodity Insights data.

"Derivative market participants chose to move positions to forward months by the end of the month," said an international broker, adding that it was quite normal for January.

The average open interest for the iron ore 62% Fe fines futures dropped 5.08% to around 116.17 million mt in January, the data showed.

The dollar-denominated front-January derivatives contract for iron ore 62% Fe futures traded on SGX stood at $135.13/dmt at the end of January, down about 0.91% from $136.37/dmt at the end of December.

Seaborne trading activities also increased in January due to restocking activities ahead of Lunar New Year holidays in China.

The Chinese iron ore market received a boost after the People's Bank of China announced a larger-than-expected cut in banks' reserve requirement ratio by 50 basis points Jan. 24, in a bid to support its struggling economy and lift consumer confidence.

However, close to the end of the month, most Chinese steel mills finished preholiday iron ore restocking. Thin restocking demand, ample stoc...