FX.co ★ Iron Ore Pressured by Weak China Demand

Iron ore futures remained around CNY 775 per ton, hovering near their lowest levels in four months due to sluggish demand in China driven by a seasonal slowdown in the steel industry. Data from the sector highlighted a sharp decline in Chinese steel demand during the third quarter compared to the previous quarter, with projections indicating sustained weakness through the end of the year. Additionally, winter weather and maintenance activities at steel mills are expected to further dampen sector activity. A private survey revealed that growth in Chinese manufacturing decelerated more than anticipated in October amidst escalating trade tensions with the United States, while official figures indicated the longest contraction in over nine years. On a global scale, iron ore shipments remained high in October, leading to increased inventories in China. The anticipation of rising supply from Guinea's significant Simandou mine added further downward pressure on prices.