Negative feedback pressure is increasing, iron ore prices are expected to face downside risk this week

During August 5-9, iron ore prices first fell and then rose. According to SMM shipping data, global iron ore shipments increased by 8.3% WoW, showing a recovery trend. However, due to reduced shipments in July and weather impacts, iron ore arrivals plummeted by 28.6%. Demand side, the average daily output of pig iron from blast furnaces in steel mills continued to decrease by 25,800 mt, and iron ore demand continued to decline. Additionally, the apparent demand for rebar and hot-rolled coil significantly dropped, coupled with market concerns about future export prospects, causing iron ore futures prices to hit new lows. However, overseas macroeconomic data performed well, and market concerns about an overseas economic recession eased, leading to a rebound in iron ore prices later in the week. The spot price of PB fines in Shandong region decreased by 2 yuan/mt WoW.
Looking ahead to this week, global iron ore shipments are expected to remain high. With improving domestic weather conditions, arrivals are likely to increase significantly. Demand side, with more blast furnace maintenance in steel mills, pig iron production is expected to decline further this week, putting pressure on iron ore prices. However, considering the recent end of overseas recession trading and the rebound in domestic macroeconomic data, market sentiment has improved. It is expected that the downside space for iron ore prices this week will be limited, and overall, they will show a weak and volatile trend.