Iron ore futures declined on Friday, pressured by high port-side inventories in China and concerns over the steel demand outlook, although relatively firm steel production levels limited losses.
Market participants said high iron ore inventories at major Chinese ports, along with increasing global supply, continued to weigh on the longer-term market outlook.
Chinese steel traders noted that downstream steel demand remained relatively stable, although the approaching rainy season may affect construction activity and steel consumption in the coming weeks. Recent steel price increases also reportedly slowed trading activity, as buyers adopted a more cautious approach.
Investors also closely monitored the outcome of discussions between U.S. President Donald Trump and Chinese President Xi Jinping regarding bilateral trade relations, which added caution to market sentiment.
Some analysts said Friday’s decline also reflected technical profit-taking after recent gains in iron ore futures.
However, losses were limited by relatively strong steel production levels in China, supported by reportedly healthy steel mill margins. Market insiders also noted continued destocking at Chinese ports, although at a slower pace compared to the previous week.
According to the China Iron and Steel Association (CISA), average daily crude steel output among member mills increased by 3.6pct in the first ten days of May compared to late April levels, reaching 2.11 mln tons per day, indicating firm near-term iron ore demand.
On the Dalian Commodity Exchange, the most-traded September iron ore contract declined by 0.67pct to 809.5 yuan (USD 119) per ton, down around 0.6pct compared to last Friday’s morning session.
Coking coal and coke futures declined by 1.57pct and 0.74pct to 1,225 yuan (USD 180) and 1,807 yuan (USD 266) per ton, respectively.
On the Shanghai Futures Exchange, rebar futures fell by 0.43pct to 3,232 yuan (USD 475) per ton, while HRC futures declined by 0.69pct to 3,446 yuan (USD 507) per ton. Wire rod futures edged lower to 3,362 yuan (USD 494) per ton, while stainless steel futures fell by 1.2pct to 14,835 yuan (USD 2,181) per ton.
1 USD / 6.8 yuan
| Item | Closing Price (in yuan) | Difference from Night Session (pct) | Difference from Previous Morning Session (pct) |
|---|---|---|---|
| Wire Rod | 3,362.00 | ▼ -0.06 | ▼ -1.04 |
| Hot Rolled Coils | 3,446.00 | ▼ -0.69 | ▼ -1.02 |
| Rebar | 3,232.00 | ▼ -0.43 | ▼ -0.77 |
| Stainless Steel | 14,835.00 | ▼ -1.20 | ▼ -2.36 |
| Iron ore | 809.50 | ▼ -0.67 | ▼ -1.30 |
| Coke | 1,807.00 | ▼ -0.74 | ▼ -0.50 |
| Coking Coal | 1,225.00 | ▼ -1.57 | ▼ -1.55 |
