Iron Ore Prices Edge Lower as Chinas Property Slump Persists

Iron ore futures decline: Dalian iron ore contract slipped 0.5% to ¥794.5/tonne (US$111.54), while Singapore futures dropped 0.38% to US$105.3/tonne at the time of writing.
 

• China’s property woes: August new home prices fell 0.3%, extending a downturn since May 2023, signaling persistent weakness in housing demand.
   
• Steel demand outlook: Analysts expect slight recovery in construction steel demand in September, supported by improved weather and restocking ahead of China’s National Day holiday.

Iron ore futures slipped in early trade on Monday, with traders pointing to continued weakness in China’s property sector as the main drag on sentiment. Despite recent gains, the market is showing signs of caution as broader demand signals remain soft.

Futures Market Performance

At the time of writing, the most actively traded January iron ore contract on the Dalian Commodity Exchange was down 0.5% at 794.5 yuan (US$111.54) per metric tonne. Meanwhile, the benchmark September contract on the Singapore Exchange eased 0.38% to US$105.3 per tonne. The latest declines follow a period of strength, with iron ore recording three straight weeks of gains supported by renewed steel mill activity in China. Analysts note that momentum has slowed as traders weigh mixed demand indicators.

China’s Property and Steel Signals

Fresh data showed that China’s new home prices fell 0.3% in August from the previous month, extending a downturn that began in mid-2023. The prolonged property weakness continues to weigh heavily on demand for steel-intensive construction materials. At the same time, China’s crude steel output dipped 0.7% year-on-year in August, with production over the first eight months of the year down 2.8% compared to the same period last year. Although new bank lending picked up in August after July’s contraction, the rebound was weaker than expected, reinforcing concerns about fragile credit appetite.

Outlook for Iron Ore

Market watchers expect near-term fluctuations as traders balance seasonal construction demand with ongoing property sector challenges. While some improvement in steel consumption is anticipated in September due to better weather conditions, the broader trajectory for iron ore remains tied to China’s ability to stabilize its housing market. At the time of writing, iron ore futures remain under pressure, reflecting persistent uncertainty around China’s economic recovery.

Disclaimer for Kapitales Research

The materials provided by Kapitales Research, including articles, news, data, reports, opinions, images, charts, and videos ("Content"), are intended for personal, non-commercial use only. The primary goal of this Content is to educate and inform readers. This Content is not meant to offer financial advice, nor does it include any recommendation or opinion that should be relied upon for making financial decisions. Certain Content on this platform may be sponsored or unsponsored, but it does not serve as a solicitation or endorsement to buy, sell, or hold any securities, nor does it encourage any specific investment activities. Kapitales Research is not authorized to provide investment advice, and we strongly advise users to seek guidance from a qualified financial professional, such as a financial advisor or stockbroker, before making any investment choices. Kapitales Research disclaims all liability for any direct, indirect, incidental, or consequential damages arising from the use of the Content, which is provided without any warranties. The opinions expressed by contributors or guests are their own and do not necessarily reflect the views of Kapitales Research. Media such as images or music used on this platform are either owned by Kapitales Research, sourced through paid subscriptions, or believed to be in the public domain. We have made reasonable efforts to credit sources where appropriate. Kapitales Research does not claim ownership of any third-party media unless explicitly stated otherwise.

Customer Notice:

Nextgen Global Services Pty Ltd trading as Kapitales Research (ABN 89 652 632 561) is a Corporate Authorised Representative (CAR No. 1293674) of Enva Australia Pty Ltd (AFSL 424494). The information contained in this website is general information only. Any advice is general advice only. No consideration has been given or will be given to the individual investment objectives, financial situation or needs of any particular person. The decision to invest or trade and the method selected is a personal decision and involves an inherent level of risk, and you must undertake your own investigations and obtain your own advice regarding the suitability of this product for your circumstances. Please be aware that all trading activity is subject to both profit & loss and may not be suitable for you. The past performance of this product is not and should not be taken as an indication of future performance.

Kapitales Research, Level 13, Suite 1A, 465 Victoria Ave, Chatswood, NSW 2067, Australia | 1800 005 780 | info@kapitales.com