Iron ore futures experienced a significant rise on Friday, marking their largest weekly gain since mid-May as a result of declining inventories of both iron ore and steel. This upswing overshadowed concerns regarding Taiwan’s forthcoming anti-dumping duties. The September iron ore contract on China’s Dalian Commodity Exchange (DCE) closed up 1.99% at 716.5 yuan (approximately $99.95) per metric ton. Overall, the contract saw a weekly increase of 1.64%, breaking a streak of two consecutive weeks of losses.
On the Singapore Exchange, the benchmark July iron ore contract rose 1.43% to $94.65 a ton as of 0801 GMT, marking a weekly increase of 1.11% after enduring five weeks of declines. Analysts at ANZ noted that falling iron ore port inventories are providing positive support for prices. Recent data from SteelHome indicated that total stockpiles across Chinese ports decreased by 0.74% week-on-week, reaching 133.6 million tons as of June 27. Additionally, Mysteel reported a continued drop in finished steel inventories held by Chinese traders for the week of June 20 to 26, which was the seventh consecutive weekly decline, though the rate of decline had slowed due to increased production from domestic steel mills.
Despite these gains in iron ore, China’s industrial profits faced a steep decline in May compared to the previous year, largely due to weak domestic demand amid a prolonged property crisis and competitive pricing pressures in the automotive sector. On the trade front, Taiwan is poised to impose anti-dumping duties as high as 20.15% on Chinese-made hot-rolled steel starting July 3. Meanwhile, other steelmaking materials on the DCE showed positive movement, with significant gains in coking coal and coke.