Iron ore futures rose on Wednesday, supported by concerns over a potential supply disruption at Port Hedland, the world’s largest iron ore export terminal, although the medium-term outlook remained weak due to soft steel demand and abundant supply.
Workers at BHP Group’s Port Hedland operations in Western Australia are scheduled to stage an eight-hour strike on 16 July after enterprise agreement negotiations between the company and the Combined Ports Unions failed to reach a settlement.
The planned strike provided near-term support to prices, although analysts said any disruption is unlikely to significantly tighten the market given the high level of iron ore inventories at Chinese ports.
Iron ore also received support from higher freight costs after crude oil prices strengthened amid renewed geopolitical tensions between the United States and Iran.
Despite the rebound, market fundamentals remained bearish. High iron ore inventories at Chinese ports and ample seaborne supply continued to weigh on prices. Market sources also said Chinese steel production has gradually started to decline, with more mills expected to bring forward maintenance schedules to reduce supply pressure in the finished steel market, which would further curb iron ore consumption.
In the spot market, Chinese steel traders reported a modest improvement in domestic sentiment. Expectations of stronger steel demand from the Middle East have also weakened following the renewed escalation in tensions between the United States and Iran.
On the Dalian Commodity Exchange, the most-traded September iron ore contract rose 0.88pct to 746 yuan (USD 109.7) per ton. Coking coal and coke futures increased 0.98pct and 0.46pct to 1,293.5 yuan (USD 190) per ton and 1,956.5 yuan (USD 288) per ton, respectively.
On the Shanghai Futures Exchange, rebar futures gained 0.72pct to 3,096 yuan (USD 455) per ton, while HRC futures rose 0.33pct to 3,300 yuan (USD 485) per ton. Wire rod futures increased 0.33pct to 3,349 yuan (USD 493) per ton, while stainless steel futures fell 2.33pct to 14,450 yuan (USD 2,125) per ton.
1 USD / 6.79 yuan
| Item | Closing Price (in yuan) | Difference from Night Session (pct) | Difference from Previous Morning Session (pct) |
|---|---|---|---|
| Wire Rod | 3,349.00 | ▲ 0.33 | ▲ 0.45 |
| Hot Rolled Coils | 3,300.00 | ▲ 0.33 | ▲ 0.52 |
| Rebar | 3,096.00 | ▲ 0.72 | ▲ 0.90 |
| Stainless Steel | 14,450.00 | ▼ -2.33 | ▼ -2.25 |
| Iron ore | 746.00 | ▲ 0.88 | ▲ 1.41 |
| Coke | 1,956.50 | ▲ 0.46 | ▲ 1.05 |
| Coking Coal | 1,293.50 | ▲ 0.98 | ▲ 1.58 |