Market Sentiment Weakens as Iron Ore Prices Fall Back From Highs [SMM Commentary]

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Today, Dalian iron ore futures pulled back from highs, with the most-traded I2505 contract closing at 812 yuan/mt, up 1.10% for the day. Traders showed weak enthusiasm for selling. Steel mills adopted a more cautious sentiment, and market transaction activity was moderate. In Shandong, mainstream transaction prices for PB fines were at 800-804 yuan/mt, down 5-10 yuan/mt from yesterday. In Tangshan, PB fines transaction prices were around 820 yuan/mt, down 10 yuan/mt from yesterday. Today, Trump announced a 25% tariff on steel and aluminum imports from all countries. Following the confirmation of this news, concerns over potential obstacles to direct or indirect steel exports intensified, market sentiment worsened, and some bulls took profits and exited, leading to a decline in iron ore futures prices. Fundamentally, SMM weekly maintenance data showed that this week’s impact from maintenance increased by 62,300 mt, up WoW. It is expected that the impact from maintenance will further increase next week, with iron ore supply pulling back after a temporary increase. Although Australian cyclones caused some disruption to recent shipments, overall iron ore supply remained ample, with limited short-term impact, failing to provide support for ore prices. Overall, market sentiment was weak, and ore prices are expected to consolidate weakly in the short term.