In July, overseas mines experienced a seasonal decline in shipments, with weekly shipments dropping to around 30 million mt. However, the high shipment volumes in the previous period led to an increase in port arrivals. At the same time, due to worsening losses at steel mills, some mills began to shut down blast furnaces for maintenance, but the reduction in pig iron output was relatively small, and the demand for iron ore remained high. Port inventories continued to accumulate. On the macro side, important meeting was held in mid and late July, and market expectations for policies were strong. Additionally, the US election in July and the increased expectation of a US Fed rate cut in September caused significant market sentiment fluctuations. Furthermore, the brief transition period between the old and new national standards for rebar in July triggered market panic, leading to a deep decline in iron ore prices after a brief rise.
Looking ahead to August, end-user demand remains weak, and most steel mills nationwide are in a loss-making state. More mills are undergoing blast furnace maintenance, leading to a significant drop in pig iron output, which has notably dragged down iron ore demand. However, with the end of maintenance at overseas mines, shipments may increase, and the fundamentals of iron ore remain weak, providing limited support for ore prices. Considering the approaching peak season, end-user demand is expected to improve, and with the increased expectation of a US Fed rate cut, iron ore prices are likely to rebound in August, potentially showing a trend of first weakening and then strengthening.
