Iron Ore Futures Decline for Fourth Consecutive Day in Singapore
The price of iron ore has reached its lowest level since 2022 due to concerns that global supply is outpacing demand. This is primarily attributed to Chinese steelmaking companies facing a crisis and reducing their production, while major mining companies are increasing exports, according to Bloomberg.
Futures contracts for the commodity have fallen for the fourth day in Singapore, dropping below $94 per ton. This decline follows data from China indicating that steel production decreased to approximately 83 million tons last month, which is a 9% reduction compared to the previous year. China is the largest importer of iron ore and sets the tone for the global market.
Iron ore has been one of the biggest losers among commodities this year, with benchmark prices declining by about one third. The troubles faced by factories in China intensified this week when China Baowu Steel Group Corp., the world’s largest steel producer, raised alarms about a crisis in the industry.
China’s Economic Slowdown
The economy of the People’s Republic has slowed down this year, as authorities attempt to address a prolonged real estate crisis that has impacted steel demand.
Futures fell by 3.1% to $92.65 per ton, marking the lowest price during the day since November 2022, and were trading at $93.25 at 6:00 PM local time in Singapore (1:00 PM Bulgarian time).
Supply Insights
Regarding supply, Port Hedland, the main seaport for iron ore exports from Australia, reported flows of 43.2 million tons last month. Although this is lower than the record set in June, it remains consistent with data from the same month last year.
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