Iron ore price slides further on outlook for weak Chinese steel demand
Iron ore futures tumbled to their lowest in more than a year on Wednesday, extending a selloff that followed a brief rebound last week, amid growing worries over China’s troubled steel industry.
According to Mining.com, iron ore futures (SCO:COM) in Singapore recently were -1.7% at ~$92/ton in a fourth straight day of losses, and the most actively traded January iron ore contract on the Dalian Commodity Exchange in China was -3.1% to 689.5 yuan/metric ton ($96.95), its weakest level since August 22, 2023.
Potentially relevant stocks include BHP (NYSE:BHP), Rio Tinto (RIO), Vale (VALE), Fortescue (OTCQX:FSUMF), Glencore (OTCPK:GLCNF) (OTCPK:GLNCY) and Anglo American (OTCQX:AAUKF) (OTCQX:NGLOY).
“Last week’s blindly optimistic and irrational sentiment rally is now being rationally unwound, as the market once again comes to terms with the realization of terrible downstream steel demand-side fundamentals in China,” Navigate Commodities managing director Atilla Widnell said, according to Mining.com.
“Demand for steel in China, the world’s biggest producer, appears set to slip,” Bloomberg Intelligence analysts Richard Bourke and Grant Sporre said, seeing Chinese steel consumption ultimately fading to 70%-80% of its peak, in line with historic trends for other major economies.