Iron ore futures fall as supply overhang persists

Iron ore futures fell on Thursday as high port inventories and weak steel production continued to weigh on the market, despite signs of improved steel demand following the week-long holidays in early October.

Iron ore fundamentals remain under pressure, with port stocks increasing after the holiday and steel mills maintaining cautious production plans.

Market sources indicated that lower coke prices have improved steelmakers’ margins, although profitability remains limited.

Meanwhile, Chinese steel demand showed some improvement as downstream buyers returned to the market after the holiday. Industry data showed that inventories of major steel products held by Chinese traders declined recently. However, some Chinese steel traders pointed out that the recovery remains uneven, with domestic steel prices fluctuating and export activity remaining slow.

On the Dalian Commodity Exchange, the most-traded iron ore contract fell 0.44pct to 671.5 yuan (USD 100.3) per ton. Coking coal declined 3.19pct to 1,503 yuan (USD 225) per ton, while coke dropped 2.47pct to 1,973 yuan (USD 295) per ton.

On the Shanghai Futures Exchange, rebar slipped 0.16pct to 3,071 yuan (USD 459) per ton, while HRC edged up 0.03pct to 3,242 yuan (USD 484) per ton. Wire rod rose 0.35pct to 3,434 yuan (USD 513) per ton. Stainless steel fell 2.33pct to 13,210 yuan (USD 1,974) per ton.

1 USD / 6.69 yuan