Iron ore prices fell as investor focus shifted from China’s stimulus plans and demand outlook to the prospects for global supply, with several major miners set to release their quarterly production reports. Futures in Singapore dropped to approximately $107 per ton after rising more than 3% over the previous two sessions, fueled by China’s recent announcements regarding economic support.
This week, major companies including Australia’s BHP Group Ltd., Rio Tinto Group, and Brazil’s Vale SA are scheduled to report their production figures.
Iron ore has been on a downward trend for most of 2024, primarily due to a slowdown in China, exacerbated by a protracted property crisis that has significantly weakened domestic demand for steel. As a result, steel mills have had to cut production while increasing their overseas sales. Despite recent monetary and fiscal measures announced by Beijing to stimulate growth, details regarding the fiscal initiatives remain vague.
Additionally, leading iron ore producers have been enhancing their supply levels, benefitting from operational costs that remain substantially below current spot prices. Brazilian exports have been particularly robust, with September shipments marking the second-highest volume recorded for that month.
As of 10:02 a.m. in Singapore, iron ore prices had decreased by as much as 1% to $106.50 per ton, while trading slightly higher at $107.40. This marks a nearly 25% drop in prices this year, positioning iron ore as one of the worst-performing major commodities of 2024. Concurrently, yuan-denominated steel contracts in China also experienced declines.
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