[China Iron Ore Brief] Iron Ore Concentrates Prices May Be in the Doldrums Next Week

This week, ferrous metals continued to pull back, with coking coal and coke seeing the most notable correction. In the first half of the week, the Ministry of Industry and Information Technology issued a notice on the implementation measures for capacity replacement in the steel industry, proposing that the capacity replacement ratio for ironmaking and steelmaking should be no less than 1.5:1. The further tightening of capacity replacement requirements had a longer-term impact. Meanwhile, macro markets outside China experienced significant fluctuations, and market expectations for ex-China "interest rate hikes" strengthened. In the second half of the week, data on the five major steel products were released, showing production increased somewhat while inventory continued to decline. Spot market side, traders began to show some flexibility on prices, the spot-futures price spread for hot-rolled coil continued to narrow, some spot-futures arbitrage traders mainly cut losses with shipments, and end-users continued to restock on an as-needed basis...

Iron ore futures weakened today, with the most-traded contract I2609 closing at 792 yuan/mt, down 0.13% from the previous trading session. Port spot prices were basically flat compared to the previous day.

[SMM HRC Daily Trading] On May 22, the total daily HRC trading volume of sample enterprises in SMM's four cities (Shanghai, Lecong, Tianjin, and Ningbo) was 13,010 mt, down 520 mt or 3.8% DoD, down 7.8% YoY by the Gregorian calendar, and up 14.63% YoY by the lunar calendar.