Macro News Boosts Market Sentiment, Iron Ore Prices Follow Upward [SMM Brief Review]

 Dalian iron ore futures strengthened today, with the most-traded I2601 contract settling at 786.5 yuan, up 1.94% from the previous trading day. Main port spot cargo prices rose 10-15 yuan/mt compared to the previous trading day, with PB fines transaction prices in Shandong at 785-790 yuan, up 10 yuan/mt; PB fines transaction prices in Hebei were at 795-802 yuan/mt, up 10-12 yuan/mt from the previous trading day. Steel mills procured based on demand today, while traders followed market trends, resulting in a relatively subdued overall trading atmosphere. Environmental protection-driven production restrictions entered the implementation phase this week in Tangshan, Hebei, with most steel mill blast furnaces undergoing maintenance and idling starting today, leading to a significant daily reduction in hot metal production and a decline in iron ore demand. However, positive outcomes from the US-China trade talks over the weekend, coupled with US CPI data supporting expectations for a US Fed interest rate cut, boosted market sentiment and drove futures higher. In the short term, iron ore prices are expected to hold up well. Considering the implementation of the coke price hike, which further compressed steel mill profits, hot metal production is anticipated to decline further, limiting the upside potential for ore prices.