Price Spread Widened Between High-Grade and Medium-Grade Imported Iron Ore

Iron ore futures were weaker today. The DCE most-traded I2701 contract settled at 710.5 yuan/mt, up 0.28% from the previous session. Qingdao port spot prices were broadly flat. Traders were active in offering while mills stayed on the sidelines. Spot trading was thin.

The domestic ore market in eastern Liaoning is generally stable, with traders rarely making inquiries for goods. Mining and processing operations remain at low levels, and holders are reluctant to sell below their psychological expectations. Supply-demand trading is cautious and need-based. End-use demand has yet to show significant improvement, and steel mills lack the motivation to resume or ramp up production. Iron ore demand remains weak with little room for improvement, compounded by expectations of a downward adjustment in mid-month settlement prices by leading steel enterprises.

[SMM Analysis] Bearish Factors Materialize, Sentiment Recovers, Supply Contracts Marginally, Stainless Steel Inventory Dips Slightly: SMM, September 17: This week, stainless steel social inventory reversed its earlier mild buildup trend, achieving a moderate overall destocking as the inventory midpoint edged lower, with peak-season inventory pressure easing marginally. Total inventory in the two core markets of Wuxi and Foshan pulled back slightly, declining from 926,200 mt on September 10, 2026 to 923,800 mt in the latest period, down 0.26% WoW, with inventory showing a steady destocking trend overall. This week, stainless steel market sentiment was initially subdued before recovering, as macro headwinds materialized and low-level restocking demand was released, jointly driving the mild inventory drawdown. Earlier in the week, before the US Fed rate hike landed, bearish macro sentiment weighed on the market, SS futures fell sharply, with the low briefly touching 13,290 yuan/mt, while the spot market was gripped by pessimism and wait-and-see sentiment, end-user transactions were sluggish overall, and the pace of inventory digestion slowed temporarily. Once the Fed rate hike landed, macro headwinds were largely priced in, and with futures prices pulling back to the lower end of the year's range, market cost-effectiveness became prominent, downstream and trader restocking demand at low levels gradually emerged, driving a phased recovery in spot transactions and effectively accelerating inventory digestion. Supply-side pressure also eased marginally, as stainless steel mill production schedules pulled back in September, the pace of industry supply release contracted, and futures warrant inventory continued to decline, further supporting the steady destocking of social inventory. Overall, the materialization of macro headwinds repaired market sentiment...