FX.co ★ Iron Ore Approaches 7-Week Low

Iron ore futures in China fell to about CNY 705 per ton on Monday, approaching a seven-week low as abundant global supply and softening steel demand weighed on prices. Industry data showed that iron ore inventories at major Chinese ports rose last week, while overseas shipments have rebounded to seasonally high levels, easing earlier supply-side disruptions.

At the same time, profitability at Chinese steel mills deteriorated again last week, and average daily hot metal output also declined. In response, the China Iron and Steel Association urged mills to cut production and draw down inventories in order to preserve margins and curb oversupply.

Separately, data from the World Steel Association indicated that global crude steel production fell 1.2% year-on-year in August to 144.2 million tons. In a further sign of headwinds, China’s industrial profit growth slowed in August as weak domestic demand offset strength in high-tech and AI-related manufacturing, adding to concerns over the overall demand outlook.