ASX 200 iron ore shares have lifted in the past month, but could some news out of China provide a boost?
The BHP Group Ltd (ASX: BHP) share price has risen 13% in the past month. Meanwhile, Rio Tinto Ltd (ASX: RIO) shares have risen 2.24% and Fortescue Metals Group Ltd (ASX: FMG) shares have jumped 8.53%.
So what could be impacting investor sentiment in these ASX 200 iron ore shares?
Image source: Getty Images
Could China provide a boost?
Amid China reopening its economy following harsh COVID-19 lockdowns, it seems ASX iron ore shares are now in focus.
Australia is the world's largest iron ore exporter, according to Statistica figures. Meanwhile, China is the biggest iron ore importer.
In financial results last week, BHP said demand in China into FY23 is "improving". BHP said China is "pro-growth".
In contrast, the miner said on the demand side, the rest of the world is "deteriorating" and "anti-inflation" heading into FY23.
In half-year results in late July, Rio said China has "modest inflationary pressures" and more room to "promote growth".
In comments cited by The Age, Ausbil Global Resources Fund portfolio managers Luke Smith and James Stewart said China is "stimulating growth", adding:
While Western developed economies are slowing, China is reopening, and is likely to accelerate growth coming out of recent hard COVID lockdowns through significant stimulus.
Meanwhile, Saxo Bank country head of direct sales David Harvie is predicting iron ore consumption in China to fire up again. He said:
Building cities the size of Brisbane once a month, or whatever they're doing over there, that ain't going anywhere either. Our house theory is that it is a demand question, and that should be satisfied by virtue of some of those large economies kicking off again.
However, ANZ commodity strategists Daniel Hynes and Soni Kumari see "limited upside" in iron ore prices". In an ANZ research note last week, they said:
We ultimately see prices at the end of 2023 sitting under USD100/t as the market tightness eases.
