Iron ore futures weakened today, with the most-traded contract I2609 closing at 792 yuan/mt, down 0.13% from the previous trading session. Port spot prices were basically flat compared to the previous day. Traders showed moderate enthusiasm in offering prices; steel mill purchases were mostly driven by rigid demand; overall spot market transactions were limited. As of May 22, total inventory at main ports reached 148.09 million mt, down 670,000 mt WoW; meanwhile, daily average port pick-up volume was 3.202 million mt, edging down 42,000 mt. Overall port data indicated that iron ore rigid demand was strongly supported by fundamentals, as daily average pig iron production remained at high levels. In addition, steel mill profits were currently favorable, and hot metal production is expected to edge up further, with iron ore rigid demand providing bottom support for ore prices. Iron ore is expected to have limited downside room next week, likely boƩoming out before moving sideways.

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Source: Metals Market Index (MMI)