Iron Ore Prices Show Relative Resilience, Short-Term Sideways Movement May Continue [SMM Brief Commentary]

Today, iron ore futures fluctuated rangebound, with the most-traded contract I2605 closing at 778.5, up 0.58% from the previous trading day. Traders showed moderate willingness to sell; steel mills purchased as needed. Market trading activity was moderate. In Shandong, the transaction price for PB fines was 785-792 yuan, basically stable compared to yesterday's price; in Hebei, the transaction price for PB fines was 803-810 yuan/mt, also basically stable compared to yesterday's price.

Data today showed a slight decrease in the production of the five major steel products, with total inventory continuing to decline. Current end-use demand is in the off-season, and apparent consumption is expected to have further room to decline, with overall market sentiment leaning weak. However, as hot metal production gradually rebounds, coupled with strengthening expectations for pre-Chinese New Year stockpiling after entering January, supportive news flow may strengthen. Fundamentally, the supply-demand structure for iron ore remains better than that of finished steel, continuing to show relative resilience within the industry chain. Overall, iron ore prices are expected to continue a sideways movement in the near term.