Iron ore hit the lowest level since 2022 on concern that global supply is running ahead of demand, with China’s steelmakers mired in a crisis and cutting output just as major miners boost exports.
Futures sank for a fourth day in Singapore, falling below $US94 a tonne, as data from China showed mills reduced steel production to about 83 million tonnes last month, 9 per cent 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 — the world’s largest producer — sounded the alarm about an industry crisis as product prices collapse.
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 per cent to $US93.70/t — the lowest intraday price since November 2022 — before trading at $US94.60 at 10.30am in Singapore.
The recent sell-off has pummelled miners’ shares, with stock in BHP Group down by more than a fifth in Australia this year.
Bloomberg