This week, ferrous metals exhibited a pattern of initial weakness followed by strength. At the beginning of the week, after the U.S.-Iran peace talks failed to reach an agreement, the U.S. military announced it would impose a blockade on all maritime traffic in and out of Iranian ports, pushing international oil prices higher once again. Mid-week, disturbances from iron ore long-term contract negotiations intensified, with market rumors suggesting that restrictions on certain previously limited products had been partially lifted. Subsequently, news emerged of an unexpected shutdown at an Australian refinery, raising market concerns that a diesel supply deficit could trigger mine shutdowns, which in turn would lead to short-term supply tightening. Coupled with rising expectations of a second round of coke price increases, ferrous metals successfully rallied in the latter half of the week...

DCE iron ore futures trended stronger today. The most-traded contract I2609 ultimately closed at 764 yuan/mt, up 0.99% from the previous trading session. Spot prices rose 2-5 yuan/mt from the previous trading day. Traders quoted actively, while steel mills mostly remained on the sidelines purchasing on demand; overall spot transactions were moderate. Fundamentals, the SMM survey showed that the blast furnace utilization rate at 242 sample steel mills was approximately 90.21% this week, up 0.91% WoW. Daily average pig iron production reached 2.4441 million mt, up 5,100 mt WoW. Overall rigid demand for iron ore remained solid and was expected to edge up next week. News, market rumors suggested that restrictions on certain previously restricted categories had been partially lifted, and iron ore arriving subsequently could be freely picked up from ports, while the previously accumulated high inventory remained restricted. Overall iron ore supply was expected to edge up, but given the current high demand, the incremental supply was expected to be well absorbed, posing no bearish factors. Therefore, iron ore prices were likely to show strong downside support in the short term, and fluctuate upward.

Dalian iron ore futures were strong in today's afternoon session. The most-traded contract I2609 ultimately closed at 763 yuan/mt, up 1.26% from the previous trading session. Spot prices rose 5-8 yuan/mt from the previous trading day. Traders quoted actively, while steel mills purchased cautiously; overall spot cargo transactions were mediocre. In terms of fundamental data, SMM survey data showed that China's iron ore port arrivals increased by 2.71 million mt WoW last week, reaching 27.13 million mt, up 10.1%; global total shipments rose 15.8% WoW to 33.71 million mt. As Australian ports recovered from cyclone impacts to normal operations, their shipments grew significantly, laying the foundation for the continuation of a loose supply-side pattern in the short term. Looking ahead, as domestic blast furnace utilization rates reached their peak, iron ore demand is expected to be secured. Meanwhile, the collapse of US-Iran negotiations and the US order to blockade the Strait of Hormuz added uncertainty to the Middle East situation, and market expectations for energy prices further provided cost support for iron ore prices. Therefore, on a comprehensive basis, iron ore prices are expected to hold up well in a fluctuating trend this week.

India recorded a 15% year-on-year decline in its exports of iron ore and pellets during the 2025-26 fiscal year, dropping to 25.78 million tons. This reduction was primarily caused by a decline in global iron ore prices, increased discounts on lower-grade fine ore in the seaborne market, and weaker demand from overseas steel producers. Concurrently, domestic absorption of raw materials increased significantly as India's crude steel production grew by 11%, leading to higher local sales prices for iron ore.

This week, ferrous metals fluctuated downward, with raw materials declining significantly more than finished steel. Cost-side logic weakened further during the week. Mid-week, both the U.S. and Iran indicated they had entered the final stage of finalising negotiation details, causing overseas market crude oil to plunge and dragging down the coal sector. In the latter half of the week, rumors emerged that negotiations between China Mineral Resources and BHP would be announced next week, with iron ore leading the downward trend. On the finished steel side, inventories of the five major steel products continued to destock, maintaining a structure of both rising supply and demand. Spot market side, futures were weak, end-user purchasing enthusiasm was lukewarm, the spot-futures price spread widened somewhat, and some market arbitrageurs between spot and futures began to take profits...

[Domestic Iron Ore Brief] Domestic iron ore concentrates market prices showed mixed performance this week. In terms of regional performance, prices in Tangshan, Qian'an, and Qianxi in Hebei rose slightly by 1-5 yuan/mt; prices in Chaoyang, Beipiao, and Jianping in western Liaoning dropped by 10-15 yuan/mt; prices in east China remained relatively stable.