MANILA (Reuters) – Dalian iron ore futures surged to a record peak on Friday and posted their biggest weekly gain since February, buoyed by expectations of sustained tightness in supply and brisk demand amid China’s renewed drive to support its slowing economy.

The most-actively traded September iron ore contract on the Dalian Commodity Exchange rose as much as 4% to 797.5 yuan ($115.20) a tonne, the highest since Dalian iron ore futures started trading in 2013.

It ended the session 2.2% higher at 783.5 yuan, posting a weekly gain of 11.4%. It has risen around 80% this year.

“Chinese ore demand has been robust and is likely to remain so for the near term,” said Westpac Banking Corp.

While profit margins for steel mills have moderated from 2018 highs, they are still well above where they were for most of the previous decade, it said. That encourages mills to continue to produce more.

Spot iron ore prices have also resumed their rally, with the benchmark 62% grade for delivery to China hovering near a five-year high at $107.50 a tonne on Thursday, up from $104.50 the previous day.

Westpac has forecast spot prices, averaging $100 a tonne for the 62% grade, to hold around current levels through the September quarter, before easing to $98 in the last quarter and to $66 a year after.

“The correction will be driven by a combination of rising supply — in the near term from China and Australia, with Brazil joining in late 2019 or early 2020 — and a levelling out in steel production,” Westpac said in a note.

Other analysts, however, see no end in sight to iron ore’s red-hot rally that began shortly after the catastrophic collapse of a tailings dam of miner Vale SA in Brazil in late January.

Safety concerns have prompted closures of other Vale mines this year as well, reducing supply to top buyer China, which makes about half of the world’s steel.

Imported iron ore inventories at Chinese ports have declined to 121.6 million tonnes as of last week, the lowest since early 2017, data compiled by SteelHome consultancy showed.

“Supply losses in Brazil look structural, leaving the market undersupplied until 2020,” ANZ analysts said in a note. “Attractive steel margins amid stronger infrastructure spending in China bode well for demand.”

On Thursday, China Vice Premier Liu He sought increased support for the economy and ample liquidity in the financial system, suggesting Beijing would soon unveil more policies to bolster growth amid rising U.S. trade pressure.

“China has a firm policy to maintain growth, almost at any cost,” analysts at SP Angel in London said in a note. Beijing is ramping up stimulus to support the economy hit by the United States’ anti-dumping measures and higher tariffs, they said.

China’s ferrous complex ended mixed on Friday, with other steelmaking raw materials edging lower.

Coking coal was down 1.1% at 1,386 yuan a tonne, while coke slipped 1.2% to 2,108.5 yuan.

ANZ analysts said China’s plentiful coal supply should keep coal prices down.

The most-actively traded October construction steel rebar contract on the Shanghai Futures Exchange ended down 0.5% at 3,755 yuan a tonne, erasing earlier gains.

Hot rolled coil, used in cars and home appliances, trimmed gains to end just 0.1% higher at 3,628 yuan a tonne.

($1 = 6.9228 yuan)