Iron Ore Rebounds from 4-Year Low

Iron ore futures recovered to above CNY 670 a ton after touching a four-year low of CNY 664 on October 27, as the return of steelmaking capacity provided some support despite concerns over rising supply. Hot metal production, a key indicator of iron ore demand, fell by 89,900 tons week-on-week to 1.75 million tons in the week ending October 24, largely due to blast furnace maintenance. Output is expected to decline further before recovering as furnaces resume operations. However, the improvement in production may offer limited support to prices, as steel mills continue to operate at a loss and demand for steel remains weak. On the supply side, iron ore arrivals at Chinese ports are expected to rebound after weather disruptions caused by typhoons along the eastern coast reduced deliveries last week. Although global shipments eased slightly, they remained seasonally high, increasing the risk of port inventories rebuilding and keeping prices under pressure in the near term.