Iron ore futures prices fell to a three-week low on Thursday, with supplies of the key steelmaking ingredient remaining firm amid a weaker steel market outlook, although new measures China’s stimulus for the local real estate sector has limited losses.
The January iron ore contract most traded on China’s Dalian Commodity Exchange (DCE) ended the day’s trading with a drop of 1.37%, at 756.0 yuan ($104.38) a ton. Earlier in the day, the contract hit its weakest level since October 24 at 751.5 yuan.
The reference iron ore for December on the Singapore Exchange fell 1.81%, to US$ 98.72 a ton.
Shipments from Australia’s main Port Hedland terminal totaled 45.6 million tonnes in October, taking this year’s total to the highest level for this period in four years, ANZ analysts said in a note.
The Australian government expects exports to rise 1.9% to 908 million tonnes in 2024, ANZ said.
The increased stockpile of steelmaking material at China’s main ports contrasts sharply with the weak performance of imported iron ore prices and demand since the beginning of this year, said Chinese consultancy Mysteel.
The rise in inventories comes amid “passive replenishment” by port traders as the iron ore market weakens further, Mysteel said.
The year has been difficult for Chinese steelmakers as falling steel prices often cut into profits amid a prolonged downturn in the property sector, Mysteel said.
China unveiled tax incentives for transactions involving real estate and land on Wednesday, aimed at supporting the struggling property market, which remains the country’s biggest consumer of steel.
