Dalian iron ore futures strengthened during the morning session before paring gains in the afternoon. The most-traded I2605 contract setiled at 824 RMB per tonne, representing a 0.55% increase from the prior trading day. In the physical market, spot prices increased by approximately 2-5 RMB. Trading houses were relatively active in offering quotations; however, enquiries from steel mills were limited, and their procurement strategies remained cautious, resulting in moderate transaction volumes. On a fundamental basis, the intensity of blast furnace maintenance has continued to decline this week. The volume of hot metal production affected by maintenance stood at 1.65 million tonnes, a week-on-week reduction of 206,500 tonnes. This figure is projected to decrease by a further 180,000 tonnes next week to 1.4684 million tonnes, indicating a progressive improvement on the demand side. Concurrently, tight supply conditions persist with no significant news of adjustments, which continues to exert a bullish influence on iron ore in the short term. Nevertheless, some capital is being held back due to concerns over future market risks, leading to a prevalent wait-and-see senment. In summary, it is anticipated that iron ore prices will maintain a high-level consolida on pattern in the near term.

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Source: Metals Market Index (MMI)