Iron ore prices rose above $150 a tonne for the first time in six months yesterday amid improving sentiment in China’s large steel sector.

The commodity, a key raw material for steelmaking, has risen 8.8 per cent since the start of the year. It has continued to rally through March, even as other industrial commodities such as copper and aluminium have sold off, and yesterday benchmark Australian iron ore with 62 per cent iron content rose to $151.25, the highest since mid-October, according to pricing agency Platts.

Colin Hamilton, senior commodities analyst at Macquarie in London, said that the rally in iron ore reflected a seasonal rebound in Chinese activity after the new year holiday in January, together with growing optimism about the state of the Chinese economy. China accounts for 60 per cent of the world’s iron ore imports.