Steady Demand Support and Cyclone Impact Create Opportunity for Iron Ore Prices to Bottom Out and Rebound [SMM Brief Review]

DCE iron ore futures were weak today, with the most-traded contract I2605 closing at 768.5 yuan/mt, down 1.73% from the previous trading day. Spot prices fell 7–8 yuan/mt from the previous trading day. Traders showed moderate enthusiasm in offering prices, while steel mills remained cautious in inquiries, mostly adopting a wait-and-see stance. Overall market trading sentiment was relatively subdued.
On the fundamental data side, SMM statistics showed that 10-port inventories stood at 117.8 million mt this week, down 270,000 mt WoW. Structurally, all four major mainstream ore varieties showed synchronous destocking. Although the inventory side showed marginal improvement, from a macro supply landscape perspective, global iron ore shipments remained strong and Chinese port arrivals continued to fluctuate at highs, with no clear signs of a pullback in the short term, indicating that supply-side pressure remains significant.
Looking ahead, although daily average hot metal production recently saw a slight rebound, indicating underlying demand persists, the approaching Chinese New Year holiday window means steel mills’ pre-holiday concentrated restocking activities have largely concluded. Subsequent raw material procurement demand will inevitably enter a phase of marginal contraction, and the rigid support below prices is gradually weakening. Overall, against a backdrop of ample supply and weakening demand, iron ore prices are expected to remain under pressure in the near term, continuing to trend in the doldrums.