Iron ore futures experienced a decline on Tuesday, driven by disappointing factory data and ongoing challenges in China’s property sector, the largest consumer of iron ore. Australian authorities have issued warnings about potential lower prices, further contributing to the negative sentiment in the market. The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) closed down 1.32% at 708.5 yuan ($98.92) per metric ton. Similarly, the benchmark August iron ore on the Singapore Exchange fell by 0.98% to $93.1 a ton as of 0533 GMT. In June, China’s manufacturing activity contracted for the third consecutive month, although the decline softened slightly.
Nonetheless, business sentiment remains low. The weakness in China’s property sector, combined with a report from the Australian government indicating a weak outlook for prices, has further affected trading sentiment. Additionally, Jiang Wei, secretary-general of the China Iron and Steel Association, recently suggested limiting exports of steel billet to address the significant rise in shipments seen this year. Customs data reveals that China’s steel billet exports more than tripled in the first five months of 2025, and the association has warned that full-year exports might surpass 10 million tons.
According to Chinese consultancy Mysteel, the total volume of iron ore exported to global markets from the leading producers, Australia and Brazil, dropped 7.4% from June 23-29, reversing the increase witnessed the previous week. Other steelmaking materials on the DCE also saw declines, with coking coal and coke dropping by 3.32% and 2.46%, respectively. Steel benchmarks on the Shanghai Futures Exchange largely recorded losses as well, with various products such as rebar and wire rod declining slightly, while hot-rolled coils experienced a minor gain.