Iron ore price hits 3-week low on firmer supply
Iron ore futures prices fell to a three-week low on Thursday, as supply of the key steelmaking ingredient remained firm amid a weaker steel market outlook, although fresh stimulus measures by top consumer China for its property sector limited the losses.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 1.37% lower at 756.0 yuan ($104.38) a metric ton. The contract earlier in the day hit its weakest level since Oct. 24 at 751.5 yuan.
The benchmark December iron ore on the Singapore Exchange was 1.81% lower at $98.72 a ton, as of 0714 GMT.
Shipments from Australia’s leading Port Hedland terminal totalled 45.6 million tons in October, bringing this year’s total to the highest level for this period in four years, ANZ analysts said in a note.
The Australian government expects exports to increase 1.9% to 908 million tons in 2024, ANZ said.
Mounting stocks of the steelmaking material at China’s major ports stands in stark contrast to the underperformance of imported iron ore prices and demand since the start of this year, said Chinese consultancy Mysteel.
The rise in stockpiles comes amid “passive restocking” by portside traders as the iron ore market weakens further, Mysteel said.
For Chinese steelmakers, this year has been tough as flagging steel prices frequently squeeze profits amid a protracted slump in the property sector, Mysteel said.
China unveiled tax incentives on home and land transactions on Wednesday, aiming to support its crisis-hit property market, which remains the country’s largest steel consumer.
Other steelmaking ingredients on the DCE fell, with coking coal and coke down 1.59% and 1.31%, respectively.
Steel benchmarks on the Shanghai Futures Exchange lost ground. Rebar dropped around 0.9%, hot-rolled coil shed nearly 1%, wire rod ticked down almost 0.3% and stainless steel declined about 0.8%.