Iron ore falls onto stockpiles at the Fortescue Metals Group Ltd. Cloudbreak mine in the Pilbara region of Western Australia, Australia, on Tuesday, Oct. 17, 2023. Chinese demand for Australian iron ore will remain strong despite the nations disappointing post-pandemic recovery, according to Fortescue Metals, the worlds fourth-biggest producer. Photographer: Carla Gottgens/Bloomberg Futures sank for a fourth day in Singapore, falling below $94 a ton, as data from China showed mills reduced steel production to about 83 million tons last month, 9% lower than a year earlier. The country is the largest importer of seaborne iron ore, and sets the tone in the global market.
Iron ore is one of the year’s biggest losers in commodity markets, with benchmark prices down by about a third. The struggles facing mills in China were thrown into sharp relief this week as China Baowu Steel Group Corp — the world’s largest producer — sounded the alarm about an industry crisis as product prices collapsed. The nation’s economy has slowed this year, with officials battling to address a drawn-out property crisis that’s hurt steel demand.
Futures of the steelmaking material retreated by as much as 2% to $93.70 a ton — the lowest intraday price since November 2022 — before trading at $94.60 at 10:19 a.m. in Singapore. The recent sell-off has pummelled miners’ shares, with stock in BHP Group Ltd. down by more than a fifth in Australia this year.