Iron Ore Gains as Steel Mill Output Improves

Iron ore futures climbed above CNY 680 per ton, recovering from four-year lows amid signs of strengthening demand in top consumer China. Industry data showed that China’s average daily hot metal output, a key indicator of iron ore demand, increased by 3,700 tons to 2.36 million tons, marking a second consecutive weekly gain as blast furnaces resumed operations following maintenance. The operating rate of blast furnaces across surveyed mills also rose by 0.14 percentage points week-on-week to 87.3% as of October 28. Meanwhile, freight rates on both Australia-China and Brazil-China routes continued to rise, providing further support for iron ore prices. However, Chinese steel mills remain unprofitable, and domestic steel demand remains weak. Robust global iron ore production could also constrain further price gains.