Iron ore futures fall as supply pressure weighs on sentiment

Iron ore futures fell on Tuesday as cautious steel mill buying, rising global supply and high Chinese port inventories continued to weigh on the market.

According to market analysts, steel output has continued to increase, but the improvement has yet to translate into stronger iron ore demand as mills remain cautious amid thin profit margins. Post-holiday restocking has also been weaker than expected, with many steelmakers limiting raw material purchases and relying on short-term procurement.

Global miners are increasing shipments to meet their annual production and shipping targets, while sustained arrivals have kept Chinese port inventories high. These factors, combined with declining freight rates, have weakened support for iron ore prices.

On the coking coal market, most mines in Shanxi have resumed production following the National Day holiday, although inspections and capacity constraints have limited the pace of supply growth. Meanwhile, the second round of coke price cuts has been implemented, adding to pressure on coke producers.

In the finished steel market, Baosteel has kept its domestic base prices for major flat steel products unchanged for November delivery bookings, while Shagang maintained its long-product list prices for October 11-20, indicating limited changes in domestic steel prices.

On the Dalian Commodity Exchange, the most-traded iron ore contract fell 1.1pct to 677 yuan (USD 101.1) per ton. Coking coal rose 1.03pct to 1,566 yuan (USD 234) per ton, while coke gained 0.42pct to 2,039 yuan (USD 305) per ton.

On the Shanghai Futures Exchange, rebar declined 0.19pct to 3,089 yuan (USD 461) per ton. HRC slipped 0.34pct to 3,254 yuan (USD 486) per ton, while wire rod was unchanged at 3,426 yuan (USD 512) per ton. Stainless steel fell 0.44pct to 13,445 yuan (USD 2,009) per ton.

1 USD / 6.69 yuan