DCE iron ore futures trended stronger today. The most-traded contract I2609 ultimately closed at 786.5 yuan/mt, up 1.16% from the previous trading session. Spot prices rose 4-8 yuan/mt from the previous trading day. Traders' offers were moderate, and steel mills purchased mainly based on rigid demand with few inquiries; overall spot transactions appeared somewhat mediocre.
Fundamentals side, an SMM survey showed that global iron ore shipments totaled 32.27 million mt last week, down 1.44 million mt (4.3%) WoW. Meanwhile, total iron ore arrivals at Chinese ports reached 21.52 million mt, down sharply by 5.61 million mt WoW, a decline of 20%. The decrease in shipments was mainly driven by Brazilian ore, which was affected by the traditional rainy season. News side, the Strait of Hormuz in the Middle East once again faced the threat of blockade, and US-Iran negotiations had yet to make progress. Energy prices and market sentiment continued to ferment, providing strong floor support for ore prices.
Currently, the supply side may face short-term contraction. Combined with near-term demand and sentiment, iron ore prices are likely to trend on the stronger side in the short term.
