Iron ore rebounds on Australian supply woes, Chinese demand outlook

Updates market at close

By Amy Lv and Michele Pek

BEIJING, Feb 12 (Reuters) - Iron ore futures rebounded on Wednesday as investors shifted focus to concerns over potential supply disruptions from major producer Australia and the prospect of growing demand in top consumer China.

Prices slid by more than 1% on Tuesday, hit by U.S. President Donald Trump's fresh tariffs, which will take effect from March 12.

Trump substantially raised tariffs on steel and aluminum imports on Monday to a flat 25% "without exceptions or exemptions" in a move to aid the struggling industries in the U.S., while risking a multi-front trade war.

The most-traded May iron ore contract on China's Dalian Commodity Exchange (DCE) DCIOcv1 ended daytime trade 0.91% higher to 828.5 yuan ($113.36) a metric ton.

The benchmark March iron ore SZZFH5 on the Singapore Exchange rose 1.8% to $107.8 a ton, the highest since October 14, 2024.

Concerns over supply disruptions revived after Western Australia's Port Hedland, the world's biggest export point for iron ore, will be closed at 6 p.m. (1000 GMT) due to tropical cyclone Zelia, boosting investor sentiment and lifting prices.

Prices were also supported by expectations of rising demand, with weather becoming increasingly favourable for outdoor construction activities, analysts said.

Hot metal output, typically used to gauge iron ore demand, is expected to pick up steadily as steel mills resumed operations after China's week-long Lunar New Year holidays, boosted by the relatively decent profitability, CITIC Futures said.

Still, Trump's trade advisers were finalising plans on Wednesday for reciprocal tariffs, further stoking trade war fears after his decision to raise tariffs for steel and aluminium.

Other steelmaking ingredients on the DCE dipped further, with coking coal DJMcv1 and coke DCJcv1 down 0.22% and 0.58%, respectively.

Most steel benchmarks on the Shanghai Futures Exchange extended losses. Rebar SRBcv1 dropped 0.3%, wire rod SWRcv1 slipped 0.14%, stainless steel SHSScv1 lost 0.53%, while hot-rolled coil SHHCcv1 gained 0.15%.

($1 = 7.3088 Chinese yuan)

(Reporting by Amy Lv and Michele Pek; Editing by Sumana Nandy)

((Amy.Lv@thomsonreuters.com;))