FX.co ★ Iron Ore Pressured by Weak Fundamentals

Iron ore futures in China were trading around CNY 710 per ton, hovering near one-month lows as weak market fundamentals continued to exert pressure. Supply remained abundant, with weekly shipments from top producer Australia climbing above 21 million tons and contributing to elevated port arrivals. Industry data also indicated that iron ore inventories at seven major ports in Australia and Brazil rose by 258,000 tons last week to 11.95 million tons. At the same time, Chinese steel mills continued to incur widening losses, driven largely by high coking coal prices as safety inspections and mine closures in Shanxi constrained domestic supply. Softer demand from China’s construction and manufacturing sectors further dampened purchases of ferrous metals. Even so, iron ore prices found some support on expectations that Chinese steel mills will increase restocking ahead of the extended Golden Week holiday in early October.