Pessimistic Sentiment Released, Iron Ore Prices Shift from Weakness to Strength [SMM Brief Review]

Today, iron ore futures on the Dalian Commodity Exchange shifted from weak to strong, with the most-traded contract I2605 closing at 786.5 yuan/mt, up 0.5% from the previous trading day. Spot prices rose by 2–5 yuan/mt compared to the previous trading day. Trader quoting activity was moderate today; steel mills restocked based on demand. The overall market trading atmosphere was moderate.

Industrial data released today showed a significant decline in apparent demand for the five major steel products, with finished product inventory at steel mills accumulating. This was mainly due to widespread rain and snow across the country, coupled with the industry's off-season, leading to persistently weak end-use demand and accelerated inventory accumulation. However, the continuous decline in ore prices this week somewhat released market pessimism. At the same time, as steel mills actively stockpiled and increased procurement ahead of the Chinese New Year, support was provided for iron ore prices, resulting in a slight strengthening trend.