Iron ore futures climbed above CNY 790 per ton, reaching near two-month highs as the intensifying conflict in the Middle East began disrupting shipments of the key steelmaking ingredient. At least three cargoes of iron ore mined by the UK’s Anglo American Plc and two from Brazil’s Vale SA have had their destinations changed, according to ship-tracking analytics data. Steelmakers in the Middle East rely heavily on imports of premium iron ore for pellets used in direct reduced iron production, a crucial precursor in steelmaking, with Oman and Bahrain serving as the region’s main pellet producers. The diverted cargoes were redirected to East Asia, including China, Malaysia, and Vietnam. Shipping flows through the Strait of Hormuz remain effectively shut due to Iranian attacks on vessels. The narrow waterway has also served as a key route for China’s steel exports to the Gulf, which has become China’s second-largest export market.
