Iron ore weakness to continue into 2025 and beyond, says Fitch Solutions’ BMI
Looking beyond 2024-2025, BMI analysts maintained their view that iron ore prices will likely follow a multi-year downtrend.
Iron ore futures strengthened on Monday, buoyed by stronger global steel production, although mounting trade tensions surrounding top consumer China capped gains.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 0.84% higher at 781.5 yuan ($107.88) a metric ton.
The contract had earlier risen as high as 791.0 yuan, its strongest since Nov. 8.
The benchmark December iron ore on the Singapore Exchange was 1.61% higher at $102.2 a ton, as of 0710 GMT.
Global crude steel output in October climbed 0.4% from the previous year to hit 151.2 million tons, World Steel Association data showed on Friday.
In China, the world’s top metals producer and consumer of the metal, crude steel production rose 2.9% to 81.9 million tons over the same period, the data showed.
Lower Chinese steel product inventory driven by robust exports also supported iron ore prices above $100 a ton, Westpac analysts said in a note.
Meanwhile, Chinese exporters and policymakers are bracing for trade disruptions as US President-elect Donald Trump has threatened to impose tariffs in excess of 60% on all Chinese goods.
The world’s second-largest economy could face nearly 40% tariffs on its exports to the US next year, said economists polled by Reuters, potentially slicing growth by up to 1 percentage point.
The US on Friday banned a range of Chinese imports, including iron ore, over alleged forced labor involving the Uyghurs, according to a government notice posted online.
Other steelmaking ingredients on the DCE lost ground, with coking coal and coke down 2.38% and 1.04%, respectively.
Most steel benchmarks on the Shanghai Futures Exchange ticked lower. Rebar dropped about 0.2%, hot-rolled coil shed around 0.3%, stainless steel dipped 0.04%, although wire rod gained about 0.3%.
($1 = 7.2441 Chinese yuan)
(By Gabrielle Ng; Editing by Sumana Nandy)
Comments