HSBC expects the average price of iron ore to rise above $100 per ton this year, despite the real estate crisis in China hurting the outlook for steel demand in the country.

Howard Lau, an analyst at the bank, said: We do not expect a significant increase in iron ore production by the major producers, but at the same time we expect demand for iron ore to remain strong.

These expectations come after iron ore prices fell by about a third in the first quarter of this year, due to fears of weak Chinese demand, which pushed prices to fall below the $100 level before partially recovering during the current month.

In Monday’s trading, iron ore futures in Singapore traded at $117.10 per ton, bringing average prices during the current year so far to about $119 per ton.