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Benchmark iron ore futures in China surged nearly 4% on Friday, erasing most of the week’s losses, as mills ramped up production on better demand hopes and resumption in transportation after lockdowns eased.

Capacity utilisation rates of blast furnaces at 247 steel plants across the country were at 86.42% this week, data from Mysteel consultancy showed, up from 84.95% the week earlier and at the highest since late-July in 2021.

The most-active iron ore futures on the Dalian Commodity Exchange, for September delivery, jumped as much as 3.9% to 925 yuan ($145.19) a tonne. They were up 2.9% to 916 yuan when market closed, logging a 0.3% dip for the week.

Spot 62% iron ore for delivery to China rose $1 to $153 a tonne on Thursday, data compiled by consultancy SteelHome showed.

“Steelmakers are resuming production on expectation of replenishing demand in the downstream sectors,” said Zhuo Guiqiu, analyst with Jinrui Capital.

Dalian coking coal futures gained 2.8% to 3,152 yuan a tonne and coke prices rose 1.1% to 4,217 yuan per tonne.

The country’s state planner approved 32 fixed-asset investment projects this year, totalling 520 billion yuan, and is studying plans for new policy reserve to expand investment in the manufacturing sector. 

Futures prices for construction material steel rebar on the Shanghai Futures Exchange, for October delivery, ended up 1.3% to 5,049 yuan a tonne.

Hot rolled coils, used in cars and home appliances, jumped 0.9% higher to 5,198 yuan per tonne.

Apparent consumption of main steel products including the two materials in China rose 3.5% as of Thursday from the week earlier, according to Reuters calculation based on production and inventory data complied by Mysteel.

Shanghai stainless steel futures edged 0.4% higher to 19,835 yuan a tonne.

($1 = 6.3710 Chinese yuan renminbi)

(By Min Zhang and Enrico Dela Cruz; Editing by Krishna Chandra Eluri and Uttaresh.V)