Iron Ore Rises on Restocking Prospects

Iron ore futures fell below CNY 800 per ton, retreating after a brief rebound as renewed geopolitical uncertainty rattled markets. Prices came under pressure following Donald Trump’s rare prime-time address on the Middle East conflict, in which he said the US is “very close” to completing its military objectives in Iran while warning that strikes could escalate. Volatility in oil markets added further strain, with Brent crude up roughly 60% since the conflict began, and gasoline prices also climbing. Losses were partly cushioned by tightening supply and other external factors. Iron ore had previously posted its strongest monthly gain since September 2024, supported by weather-related disruptions in Australia and a pricing dispute involving BHP Group. Market attention is also turning to potential fuel shortages and the ongoing cyclone season in the key exporting region, which continue to provide underlying support for prices.

Iron ore futures stabilized above CNY 810 per ton, moving sideways over the past two weeks as investors assessed disruptions from the Middle East conflict and the impact of the cyclone season in Australia. Supply risks linked to the Iran war have lifted fuel and shipping costs, maintaining a risk premium on prices. Meanwhile, supply concerns eased after Tropical Cyclone Narelle caused only limited port disruptions in Australia’s Pilbara region. In China, production curbs in the steel sector weighed on iron ore demand, with authorities reaffirming efforts to reduce overcapacity amid slowing economic activity. Elsewhere, Australia’s BHP Group and state-backed China Mineral Resources Group remain at a standoff over their 2026 supply contract, although Beijing has temporarily eased the import ban on BHP’s Jimblebar fines.

Iron ore futures fell toward CNY 810 per ton and were set to end the week little changed, as Tropical Cyclone Narelle caused minimal port disruptions in Australia’s Pilbara region. China’s key steelmaking hub of Tangshan also activated a level-two emergency response to heavy air pollution this week, raising concerns about potential output curbs and tighter environmental inspections. During the annual parliamentary sessions in Beijing earlier this month, authorities reaffirmed their commitment to reducing overcapacity in the steel sector amid weakening demand. Meanwhile, supply disruptions and higher shipping costs tied to the Middle East conflict continued to keep a risk premium on prices. Separately, stockpiles of BHP’s Jimblebar fines at several Chinese ports declined to nearly a two-month low as steelmakers accelerated shipments during a short-lived one-week easing of the import ban.