In August, iron ore prices initially dipped before rising again, and it is expected that prices might continue this trend in September

Entering August, end-user demand remained sluggish, and the apparent demand for the five major steel products continued to decrease. The national standard conversion for rebar has not been fully absorbed, and the anti-dumping investigations initiated by major export countries for HRC lead to a sharp decline in the ferrous metals series. Steel mills' profits quickly shrank, resulting in concentrated maintenance of blast furnaces and a consecutive four-week decline in pig iron production, which significantly reduced iron ore demand and dragged down ore prices. During this period, due to the sharp drop in iron ore prices, the shipment volume from some non-mainstream mines noticeably decreased, causing a contraction in supply. As the peak season approaches, expectations for end-user demand have somewhat improved. From a macro perspective, certain economic data from the United States performed well, keeping the market optimistic about overseas demand. The US Fed is almost certain to cut interest rates in September, and market sentiment is expected to remain positive ahead of the rate cut. After late August, steel and iron ore prices saw a certain rebound, with iron ore prices bottoming out and recovering.
Looking ahead to September, despite the average performance of domestic and international PMI data in August, September, being a traditional peak season, is expected to see some improvement in end-user demand. With steel mills' profits recovering, production enthusiasm will also significantly increase, leading to a notable rise in pig iron production. Additionally, the stocking demand before the National Day will further boost overall iron ore demand. From a macro perspective, the US Fed is expected to cut interest rates in September, which will provide short-term support for commodities. SMM believes that after the short-term release of pessimism, iron ore prices are likely to stabilize and rebound.