Iron Ore Price Surge on US-China Trade Optimism

Iron ore price surge momentum actually reached $103 per ton on July 29, 2025, and it climbed more than 2% as news emerged of a potential 90-day US-China trade truce extension. This iron ore price surge comes after a sharp 4% decline over the previous two sessions, and markets are finding some relief right now amid growing steel demand outlook and China economic recovery hopes that are also fueling an industrial metals rally.

Iron ore rebounded as news of a possible extension to the US-China trade truce eased some concerns about the impacts of tariffs on the global economy

— Bloomberg (@business) July 29, 2025

Iron ore rebounded as news of a possible extension to the US-China trade truce eased some concerns about the impacts of tariffs on the global economy

Iron Ore Price Surge Sparks Optimism Amid Trade Truce and Steel Demand

Source: EurometalSource: EurometalThe latest iron ore price surge was actually triggered by comments from US Commerce Secretary Howard Lutnick, who indicated that negotiations between the world’s two largest economies are underway right now. Markets have responded positively to news that a 90-day extension of the trade truce was possible, and this has been boosting sentiment for industrial raw materials along with supporting the steel demand outlook.

US Commerce Secretary Howard Lutnick said:

“A 90-day extension of a trade truce with China was possible, with negotiations between the two biggest economies underway.”

**“A 90-day extension of a trade truce with China was possible, with negotiations between the two biggest economies underway.”**While the US is not a major importer of Chinese steel, a pause in tensions between these economic powerhouses has been boosting overall economic sentiment, and as a result, demand for industrial raw materials has been strengthened.

Iron ore futures chart displaying 2025 price performance – Source: BloombergAlso Read: Dollar Reserves Hit 47% Record Low as China Drives De-Dollarization

Also Read: Dollar Reserves Hit 47% Record Low as China Drives De-Dollarization### China’s Steel Sector Drives Industrial Metals Rally

Source: Fox BusinessSource: Fox BusinessThe industrial metals rally has gained additional momentum from some positive developments in China’s steel sector, which is showing signs of recovery right now. The nation’s 22 listed steelmakers will see losses narrow by 70% in the first half compared with a year earlier, and this is supporting the iron ore price surge along with the broader China economic recovery narrative.

Bloomberg Intelligence analyst Michelle Leung stated:

“Most steel companies’ margins climbed in 1Q from a year earlier, showing signs of bottoming out from 2024.”

“Most steel companies’ margins climbed in 1Q from a year earlier, showing signs of bottoming out from 2024.”### Fifth Weekly Gain Marks Longest Streak Since 2023

At the time of writing, iron ore futures were actually trading 2% higher at $102.85 per ton as of 12:20 p.m. Singapore time. This marks the fifth consecutive weekly gain for the commodity – the longest streak since November 2023, and the sustained rally reflects an improved steel demand outlook along with optimism over China’s efforts to eliminate outdated industrial capacity.

Yuan-priced contracts in Dalian have supported the current iron ore price surge, and they have also gained ground alongside steel contracts in Shanghai. While prices have experienced some volatility throughout 2025, they now trade little changed from the start of the year, and the industrial metals rally is providing renewed momentum for the sector.

Also Read: China Invites 30 Countries to Discuss De-Dollarization at SCO Summit

Also Read: China Invites 30 Countries to Discuss De-Dollarization at SCO SummitA more positive reporting period in China, the world’s biggest steel producer, could also provide more support for iron ore going forward. The China economic recovery efforts, combined with the potential for reduced trade tensions, are creating conditions that actually favor industrial commodity prices right now.