FX.co ★ Iron Ore Slips as EU Targets China Steel

Iron ore futures fell below CNY 800 per ton on Friday, reaching a two-week low following reports of the European Commission's intention to implement significant tariffs, ranging between 25% and 50%, on Chinese steel imports and related goods in the coming weeks. This initiative is designed to limit imports and safeguard local manufacturers amidst ongoing global overcapacity that is compressing profit margins. Moreover, Western nations aim to retain their critical manufacturing capabilities. Concurrently, China, the leading producer, is gearing up to limit new capacity to address the issues of oversupply and weak pricing. On the other hand, some upward pressure on prices resulted from restocking activities ahead of the National Day holiday. Additionally, prices for domestically mined iron ore concentrates climbed across most regions last week due to tight supply conditions and consistent demand.