On Monday, May 12, the iron ore market experienced a significant rally following the US-China agreement to slash reciprocal tariffs. After talks in Geneva, US Treasury Secretary Scott Bessent announced that the two nations had agreed to a 90-day pause on measures and a tariff cut exceeding 100 percentage points down to 10%. 

This agreement has lifted investor sentiment. The most-active September iron ore contract on China’s Dalian Commodity Exchange rose by 3.16% to CNY 718.5 per ton, while the benchmark June iron ore on the Singapore Exchange hiked by 2.9% to US$99.75 per ton.

The extent of the tariff reductions surpassed expectations, helping to boost market sentiment. Additionally, stable demand supported by mills’ desire to maintain operations due to profit incentives also contributed to the price increase.