Long-Term Contract Negotiations Concluded, Iron Ore Prices Continued to Move Sideways [SMM Brief Comment]

DCE iron ore futures held up well today, with the most-traded contract I2609 closing at 786.5 yuan/mt, up 0.32% from the previous trading day. Spot prices rose in tandem by 1-3 yuan/mt. Traders quoted actively, steel mills restocked on demand, and overall spot trading sentiment was moderate. According to an SMM survey, daily average hot metal production at 242 sample steel mills was 2.4494 million mt this week, up 5,300 mt WoW. Looking ahead to next week, hot metal production is expected to dip slightly and move sideways after peaking. In addition, BHP announced the conclusion of annual benchmark negotiations last night. Although some details emerged in the market today, whether port spot cargoes of restricted grades will see short-term release remains to be confirmed. Overall, the impact of this event is gradually fading, with limited effect on prices. However, given that the month-end Politburo meeting may reinforce anti-involution policy expectations, and supported by rigid restocking demand ahead of the Labour Day holiday, iron ore prices are expected to maintain a fluctuating trend on the stronger side.