Iron ore futures moved lower on Tuesday, pressured by a combination of soft steel demand expectations and supply-side pressure that continued to dampen market confidence.
Market analysts said Chinese steel mills are facing increasing margin pressure amid subdued steel demand, which could lead some producers to bring forward maintenance schedules and reduce output in the coming weeks. Lower steel production would in turn curb iron ore consumption.
According to the National Bureau of Statistics of China, the country’s crude steel production fell by 2.7pct YoY to 84.4 mln tons in May, while finished steel output declined by 2.8pct to 123 mln tons.
The market also remains under pressure from persistently high iron ore inventories at Chinese ports and steady global shipments from major exporters, reinforcing concerns over oversupply.
Meanwhile, lower energy costs added further pressure to raw material markets. Oil prices retreated following reports of a U.S.-Iran memorandum of understanding aimed at easing regional tensions, raising expectations of lower freight and transportation costs. Sentiment was also weakened by sharp declines in coking coal and coke futures after supply concerns eased, with most coal mines resuming operations following safety inspections in Shanxi province.
On the Dalian Commodity Exchange, the most-traded September iron ore contract fell 0.54pct to 738.5 yuan (USD 108.8) per ton. Coking coal and coke futures declined by 1.85pct and 4.13pct to 1,248 yuan (USD 184) per ton and 1,925 yuan (USD 284) per ton, respectively.
On the Shanghai Futures Exchange, rebar futures slipped 0.35pct to 3,112 yuan (USD 459) per ton, while HRC futures fell 0.27pct to 3,327 yuan (USD 490) per ton. Wire rod futures declined 0.47pct to 3,359 yuan (USD 495) per ton, while stainless steel futures dropped 1.49pct to 14,885 yuan (USD 2,194) per ton.
1 USD / 6.78 yuan
| Item | Closing Price (in yuan) | Difference from Night Session (pct) | Difference from Previous Morning Session (pct) |
|---|---|---|---|
| Wire Rod | 3,359.00 | ▼ -0.47 | ▼ -0.65 |
| Hot Rolled Coils | 3,327.00 | ▼ -0.27 | ▼ -0.33 |
| Rebar | 3,112.00 | ▼ -0.35 | ▼ -0.48 |
| Stainless Steel | 14,885.00 | ▼ -1.49 | ▼ -1.85 |
| Iron ore | 738.50 | ▼ -0.54 | ▼ -0.14 |
| Coke | 1,925.00 | ▼ -4.13 | ▼ -4.70 |
| Coking Coal | 1,248.00 | ▼ -1.85 | ▼ -2.20 |