Iron Ore Rises on Supply Risks

Iron ore futures in China climbed above CNY 710 per ton on Wednesday, recovering from losses in the previous session as fresh supply concerns supported prices despite ongoing demand headwinds. Analysts cited supply disruptions in top producer Brazil linked to El Niño weather patterns. Smaller Brazilian iron ore producers are also facing sharply higher shipping costs to major consumer China, squeezing margins and leading some to cut production. On the demand side, iron ore prices gained support from expectations that Chinese steel mills will restock ahead of the extended Golden Week holiday in early October. Meanwhile, the market continues to contend with weakening steel mill profitability in China, largely due to elevated coking coal prices as safety inspections and mine suspensions in Shanxi restricted domestic supply. Softer demand from China’s construction and manufacturing sectors has also weighed on ferrous metal purchases.