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Iron Ore Prices Slumped as Bearish Macro Front Overshadowed Positive Fundamentals
May 7, 2022 10:57CST
Source:SMM
SHANGHAI, May 7 (SMM) - Affected by market pessimism, iron ore futures prices moved all the way down yesterday, closing the day down 5.12% at 825 yuan/mt.

SHANGHAI, May 7 (SMM) - Affected by market pessimism, iron ore futures prices moved all the way down yesterday, closing the day down 5.12% at 825 yuan/mt.

In addition to iron ore, other ferrous metals prices also closed down, with rebar down 3.66%, hot-rolled coil down 3.67%, coking coal and coke both down more than 2%. In terms of spot market, traders rushed to sell, while steel mills mostly stood on the sidelines.

Macro font: As the United States implemented the most aggressive monetary policy tightening since 2000, the US dollar index closed up 1.02% on Thursday, setting a new high of 103.9 since December 2002. Market panic intensified and domestic market sentiment was affected.

Fundamentals: As of May 6, iron ore inventories across 35 ports tracked by SMM totalled 138.3 million mt, a decrease of 1.79 million mt from the previous week, but up 14.9 million mt year-on-year. The daily average shipments from the 35 ports rose 187,000 mt on a weekly basis to 3.05 million mt last week.

Although the Tangshan area has lifted COVID lockdown, there are still restrictions on logistics and transportation. Due to the resurgence of the pandemic in north-east China, some small steel mills chose to hot idle their blast furnaces. On the whole, the increase in demand for iron ore is relatively limited. Give the current bearish sentiment in the macro market, it is expected that iron ore prices will maintain wide fluctuations in the short term.

SMM
Futures

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