Tug-of-War Between Longs and Shorts Continues, Iron Ore Fluctuates Downward [SMM Commentary]

Published: Feb 5, 2025 17:10

Save

Today, DCE iron ore futures moved downwards after a higher opening, fluctuating downward throughout the day. The most-traded I2505 contract finally closed at 801, down 0.99% for the day. On the first trading day after the holiday, traders actively offered goods. Steel mills made numerous inquiries but remained cautious in their purchases. Market transactions were sluggish today. Transaction prices were basically stable compared to pre-holiday levels. According to an SMM survey, as of February 5, the daily average pig iron production of 242 sample steel mills surveyed by SMM was 2.3791 million mt, up 15,000 mt MoM. Pig iron production increased slightly. Coupled with post-holiday restocking demand from steel mills, overall demand for iron ore remained robust, providing some support to ore prices. However, actual downstream demand is still in the verification phase, and market sentiment appeared slightly pessimistic. In the short term, the tug-of-war between longs and shorts is expected to continue, and ore prices may fluctuate rangebound.

》Check SMM Steel Product Prices, Data, and Market Analysis

》Subscribe to View SMM Historical Spot Metal Prices

Today, DCE iron ore futures moved downwards after a higher opening, fluctuating downward throughout the day. The most-traded I2505 contract finally closed at 801, down 0.99% for the day. On the first trading day after the holiday, traders actively offered cargoes. Steel mills made numerous inquiries but remained cautious in their purchases. Today's market transactions were sluggish. In Shandong, the mainstream transaction prices of PB fines were 790-795 yuan/mt, basically stable compared to pre-holiday levels; in Tangshan, PB fines traded at around 815 yuan/mt, also basically stable compared to pre-holiday levels. According to the SMM survey, as of February 5, the operating rate of blast furnaces at 242 steel mills surveyed by SMM was 85.97%, up 0.37 percentage points from pre-holiday levels. The daily pig iron production of the sample steel mills was 2.3791 million mt, up 15,000 mt WoW. Pig iron production increased slightly. Coupled with post-holiday restocking demand from steel mills, the overall demand for iron ore remained robust, providing some support for ore prices. However, during the holiday, the US announced a 10% tariff increase on Chinese goods, which disrupted futures prices. Additionally, downstream real demand is still in the verification phase, and market sentiment appeared slightly pessimistic. In the short term, the tug-of-war between longs and shorts is expected to continue, and ore prices may fluctuate rangebound.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

21 hours ago

Before the holiday, the black chain is unlikely to see a trend-driven market [SMM Steel Industry Chain Weekly Report].

This week, ferrous metals were in the doldrums, with coking coal and coke staging a mid-week rise. At the beginning of the week, financial markets experienced sharp fluctuations, dragging down sentiment in the ferrous chain and leading to a pullback in futures. Mid-week, Indonesia's cut to coke production quotas drove coking coal and coke futures to lead the gains, though the impact was more pronounced on thermal coal, while coking coal's rise was largely sentiment-driven and short-lived. In the latter part of the week, finished products continued their seasonal inventory buildup, and support from the raw material side weakened, causing the entire ferrous chain to pull back. In the spot market, with the Chinese New Year holiday approaching, purchasing activity slowed down further, with end-users only making limited, as-needed purchases at low prices.

21 hours ago

MMi Daily Iron Ore Report (February 6)

Today, the DCE iron ore futures continued to hit bottom today, with the most-traded contract I2605 closing at 760.5 yuan/mt, down 1.23% from the previous trading day. Spot prices fell by 5–10 yuan/mt compared to the previous trading day.

21 hours ago

[SMM Chromium Daily Review] Inquiries and Transactions Weakened, Chromium Market Showed Mediocre Performance Before the Holiday

[SMM Chrome Daily Review: Trading and Inquiries Weakened, Chrome Market Showed Mediocre Performance Before the Holiday] February 6, 2026: Today, the ex-factory price of high-carbon ferrochrome in Inner Mongolia was 8,500-8,600 yuan/mt (50% metal content), flat MoM from the previous trading day...

21 hours ago