Iron ore flat as rising shipments from Australian miners weigh

SINGAPORE: Iron ore futures struggled for direction on Thursday as investors weighed robust shipments by Australian mining companies against Chinese monetary policy support.

The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) ended morning trade 0.13% lower at 785 yuan ($112.75).

The benchmark February iron ore on the Singapore Exchange was 0.06% higher at $103.25 a ton, as of 0344 GMT.

Australia’s Fortescue posted a 2% rise in second-quarter iron ore shipments, supported by the resilient performance of its Iron Bridge project alongside an uptick in output from its hematite operations.

It maintained its forecast for fiscal 2025/26 shipments, with quarterly iron ore shipments remaining at 50.5 million tons.

An increase in iron ore shipments from Australia to China would exert downward pressure on Chinese iron ore prices.

Record high shipments coupled with an expected decline in domestic end-use steel demand are expected to suppress prices in the first half of the year, said Chinese broker Galaxy Futures.

China issued the first batch of 93.6 billion yuan ($13.44 billion) of ultra-long-term special treasury bonds to support equipment upgrades for this year, the state planner said, likely lifting market sentiment.

Vanke said on Wednesday it had gained creditor approval to defer some repayments soon to be owed on a 1.1 billion yuan ($160 million) puttable bond, likely helping the state-backed property developer stave off an imminent default.

Other steelmaking ingredients on the DCE gained ground, with coking coal and coke up 0.58% and 0.24%, respectively. Steel benchmarks on the Shanghai Futures Exchange gained.

Rebar edged up 0.42%, hot-rolled coil firmed 0.21%, wire rod increased 0.32% and stainless steel climbed 1.1%.