Market sentiment in the financial market recovers, and iron ore prices rebound slightly [SMM Commentary]

Today, Dalian iron ore futures opened slightly lower but rebounded in the afternoon. The most-traded contract I2509 eventually closed at 798.5, up 1.2% for the day. Traders actively shipped goods; steel mills purchased as needed, with some mills having large shipments of finished steel actively restocking. The market transaction atmosphere improved compared to yesterday. The mainstream transaction prices of PB fines in the Shandong region were around 780-783 yuan/mt, up 5-10 yuan/mt from yesterday; in the Tangshan region, the transaction prices of PB fines were around 790-795 yuan/mt, up 5-10 yuan/mt from yesterday.

According to SMM survey data, the impact from blast furnace maintenance increased by 27,000 mt MoM to 1.078 million mt this period. Against the backdrop of the industry off-season, the high profit levels of steel mills continue to support hot metal production at a high level, providing fundamental support for ore prices. In the afternoon, influenced by the recovery of market sentiment in the financial market, ore prices showed a slight rebound. In the short term, under the tight balance of supply and demand, the downside room for ore prices is limited. Subsequent attention should be focused on the actual disruption to the supply side caused by the environmental protection-driven production restriction policy in north China on September 3.