Iron ore futures edge lower on weak fundamentals

Iron ore futures edged lower on Wednesday as high port inventories and sluggish seasonal steel demand continued to weigh on sentiment.

Market insiders said iron ore fundamentals remained broadly balanced. Demand softened in the short term as blast furnace maintenance and recent production curbs reduced hot metal output, while elevated port inventories continued to cap prices. Although steel production may edge higher following the end of temporary output curbs in Tangshan and the gradual restart of blast furnaces, the restrictions had little market impact as many mills had already incorporated them into planned maintenance schedules amid weak seasonal demand and poor margins. As a result, steel consumption is expected to remain subdued, keeping iron ore prices range-bound.

Chinese traders said the domestic steel market remained dominated by seasonal weakness, with trading activity showing only limited improvement. Steel prices were largely stable, export offers changed little and new overseas bookings remained subdued, leaving the market without a clear directional driver.

On the Dalian Commodity Exchange, the most-traded September iron ore contract slipped 0.27pct to 739 yuan (USD 109.3) per ton. Coking coal futures eased 0.08pct to 1,248 yuan (USD 185) per ton, while coke futures gained 0.76pct to 1,845 yuan (USD 273) per ton.

On the Shanghai Futures Exchange, rebar futures edged down 0.03pct to 3,062 yuan (USD 453) per ton while HRC futures rose 0.15pct to 3,286 yuan (USD 486) per ton. Wire rod futures slipped 0.24pct to 3,270 yuan (USD 484) per ton, and stainless steel futures declined 0.10pct to 14,545 yuan (USD 2,152) per ton.

1 USD / 6.76 yuan