Iron ore headed for a brutal weekly loss, hitting the lowest level since 2022, on concern that a steel-industry crisis rippling across China will sap demand, while supplies from miners remain robust.
Futures traded below $93 a ton in Singapore, after hitting an intraday low of $92.20. The steel-making staple — one of this year’s worst performing commodities — has shed almost 9% this week, the most since March.
Steel mills in China, the biggest iron ore importer, have suffered from lackluster demand and sinking product prices, and many of them are cutting back on output. Earlier this week, leading producer China Baowu Steel Group Corp. said the industry was facing a downturn more severe than major slumps seen in 2008 and 2015. The country has been wracked by slower growth and a drawn-out property crisis, which has eroded steel consumption.
Market watchers including Macquarie Group Ltd. expect iron ore to remain under pressure given that global supplies appear to be running ahead of demand, creating a glut. If weak prices persist, that’ll be a challenge for the highest-cost producers as their operations risk becoming unprofitable.
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