Iron ore futures fell below CNY 770 per ton, hitting their lowest level in seven weeks as ample global supply met seasonally soft demand in China. Demand from China’s steel sector weakened earlier than usual this year, weighed down by persistent rainfall and an early onset of summer heat that curbed construction activity. At the same time, narrowing profit margins made steelmakers less inclined to build up inventories of the key steelmaking raw material.
On the supply side, industry data showed that shipments from Australia and Brazil remained close to a two-year high, while iron ore stockpiles at Chinese ports stayed elevated. Meanwhile, China Mineral Resources Group was reported to have advised some domestic steel producers not to engage in talks with Fortescue over a new iron ore product, sparking speculation that potential purchasing restrictions may be under consideration.
