Next Week's Hot Metal Rebounds, Iron Ore Prices Supported and Likely to Fluctuate at Highs [SMM Brief Review]

Iron ore futures were in the doldrums today, with the most-traded contract I2601 closing at 800 yuan, down 0.56% from the previous trading day. Mainstream spot cargoes at ports fell by 0-5 yuan/mt compared to yesterday. In Shandong, transaction prices for PB fines were around 800 yuan/mt, down 0-5 yuan/mt from the previous day; in Hebei, transaction prices for PB fines were 805-810 yuan/mt, down 5 yuan/mt from the previous trading day. Trading activity in the spot market was mediocre today. Steel mills mainly procured based on rigid demand, with inquiries being relatively cautious; traders showed moderate enthusiasm in offering, and trading volume was relatively small. This week, port pick-up volume for iron ore saw a significant decline, and previously arrived ore cargoes were gradually unloaded, leading to a slight WoW increase in port inventory. However, overall inventory levels remain within a healthy range, with relatively small supply-side pressure. As environmental protection-driven production restrictions in Hebei were lifted and blast furnaces under maintenance gradually resumed production, daily average hot metal output is expected to rebound significantly, driving growth in iron ore demand. On the macro front, the US Fed's interest rate cut was in line with market expectations, while no specific policies were announced following consultations between China and the US, causing market sentiment to gradually become subdued. Iron ore prices are expected to hover at highs next week.