Price trend

According to the commodity market analysis system of SunSirs, iron ore prices trended upward with some volatility last week (April 4–11; the same period applies hereafter), exhibiting a strengthening trajectory. As of the 11th, the SunSirs Iron Ore Price Index stood at 771.22 points, marking a month-on-month decline of 2.07%, as illustrated in the chart above. Last week, the iron ore market displayed a pattern of slight decline and narrow-range fluctuation; the broader "ferrous complex" sector trended downward overall, with iron ore leading the decline as prices retreated to the midpoint of their wider fluctuation range. Throughout the week, market dynamics were shaped by an interplay of macroeconomic and industry-specific news, signaling a distinct return of market pricing logic to fundamental factors.

Market analysis

Regarding inventory, as of April 10, the stock of imported iron ore across 45 major ports nationwide stood at 169.8045 million tons, a month-on-month decrease of 805,000 tons. The daily average port clearance volume was 3.1462 million tons, a week-on-week increase of 26,300 tons; the number of vessels currently at port totaled 106, an increase of two vessels from the previous week. The aggregate inventory of imported iron ore held by steel mills nationwide amounted to 88.9484 million tons, a week-on-week decrease of 390,800 tons. Steel mill profit margins stabilized last week; consequently, driven by an increase in hot metal production and the release of demand for material pickup, port clearance volumes maintained an upward trend. Port inventories continued to be drawn down last week, and this destocking trend is expected to persist into the coming week; therefore, close attention should continue to be paid to changes in port-side iron ore inventory levels over the next week.

On the supply side, as of March 16, the total global iron ore shipments for the previous week amounted to 30.488 million tons—a week-on-week increase of 1.51 million tons. Total shipments from Australia and Brazil reached 24.644 million tons, up 1.223 million tons from the previous week. Australian shipments totaled 18.753 million tons—an increase of 1.221 million tons—of which 15.872 million tons were destined for China, marking a rise of 1.213 million tons. Brazilian shipments stood at 5.892 million tons, a marginal increase of 20,000 tons. Last week saw the beginning of a recovery in shipment volumes from both Australia and Brazil. While cyclical fluctuations in overseas shipments from Australia and Brazil are primarily influenced by seasonal factors and weather conditions—leading to short-term variations in shipment volumes—the medium-to-long-term outlook suggests that the iron ore supply landscape will remain relatively ample. With the resumption of industrial operations following the Lunar New Year holidays and the active shipping efforts of overseas suppliers, both iron ore shipment volumes and port arrivals are expected to rebound in the coming week; consequently, the overall iron ore supply situation is trending toward a strengthening trajectory.

Regarding demand, as of April 10, the operating rate of steel mills' blast furnaces stood at 83.2%, a week-on-week increase of 0.13%; the capacity utilization rate for blast furnace ironmaking reached 89.74%, up 0.75% from the previous week; the profitability rate among steel mills remained stable at 48.05%; and the average daily output of molten iron totaled 2.3938 million tons, an increase of 19,900 tons week-on-week. Furthermore, the daily consumption of imported iron ore among the sampled steel mills currently stands at 2.9518 million tons, up 21,100 tons from the previous week. Last week witnessed simultaneous increases in both steel mill operating rates and molten iron output, accompanied by improving profit margins. Additionally, robust transaction volumes for finished steel products in downstream sectors provided a boost to demand from steel mills. With profits stabilizing—and showing signs of recovery—steel mills have demonstrated increased enthusiasm for maintaining production levels; consequently, demand for iron ore is projected to see a slight uptick in the coming week.

Regarding scrap steel, prices last week remained largely stable, exhibiting only minor regional divergence and limited fluctuation. Following the Qingming Festival holiday, market trading activity was moderate; while prices across various regions saw mixed movements—some rising, others falling—the magnitude of these changes was generally narrow. Looking ahead to next week, the scrap steel market is expected to maintain a pattern of weak stability and narrow-range fluctuation. On the supply side, improving weather conditions and rising resumption rates among scrap-generating enterprises suggest that the release of scrap resources is likely to continue increasing. On the demand side, scrap steel prices remain approximately 248 RMB/ton higher than the cost of hot metal; this lack of cost-effectiveness has dampened steel mills' enthusiasm for utilizing scrap, leading most electric arc furnace (EAF) mills to maintain off-peak production schedules, thereby limiting any significant growth in demand. Currently, steel mills' profitability remains lackluster—long-process mills are operating at a profit margin of around 48%, while most short-process mills are incurring losses—prompting them to maintain a cautious stance on raw material procurement, prioritizing a strictly "buy-on-demand" strategy. In terms of inventory, steel mills' scrap stockpiles have risen for three consecutive weeks; this moderate accumulation is acting as a dampener on any upward price momentum. Overall, the prevailing pattern of weak supply and weak demand is unlikely to change in the short term. Factors such as downward pressure on finished steel prices, the continued cost-effectiveness advantage of hot metal, and geopolitical instability in the Middle East are collectively capping the upside potential for scrap prices; conversely, relatively tight resource availability and restocking requirements from certain mills are providing underlying support to the market. For the coming week, the average price for heavy scrap is projected to trade within the range of 2,080–2,150 RMB/ton; market participants are advised to prioritize a "quick-in, quick-out" trading strategy, with a keen focus on trends in finished steel prices and the procurement pace of steel mills.

Market outlook

In summary, analysts at SunSirs anticipate that the iron ore market will exhibit a pattern of sideways fluctuation within a moderate range over the coming week. On the supply side, global iron ore shipments have declined, and arrivals at ports have decreased month-on-month, resulting in a short-term easing of supply-side pressure. On the demand side, hot metal production has fluctuated within a narrow range month-on-month—with the pace of growth slowing significantly—as steel mills' resumption of production nears its conclusion; consequently, expectations that "hot metal production has peaked" are gradually gaining traction. Regarding inventories, port stockpiles across the 47 major ports continue to be drawn down, providing short-term fundamental support to the market. The current market landscape is characterized by a tug-of-war between bullish and bearish forces: declining shipments and inventory drawdowns provide support to the downside, while the limited room for further increases in hot metal production caps the market's upside potential. Rumors surrounding long-term contract negotiations continue to circulate, yet with final outcomes still pending, the market remains in a "wait-and-see" phase awaiting confirmation. Key factors to monitor include the progress of long-term contract negotiations, signals indicating a turning point in hot metal production, and the sustainability of inventory drawdowns. In the short term, it is recommended to adopt a trading strategy based on range-bound fluctuations, exercising caution against aggressively chasing rallies or selling into declines.

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