- Sluggish demand, increasing spot availability weigh on prices
- Steel output cuts, weak mill margins to pressure prices further
Iron ore fines (Fe 61%) spot prices fell by $1/dmt d-o-d to $91/dmt CFR China on 2 October 2026, as the ongoing Chinese holiday weighed on buying activity and market sentiment.
Market participants held mixed views on the price outlook. Some expect further downside pressure from lower freight rates and potential cuts in Chinese coke prices after the holidays, along with weak steel mill margins and reductions in finished steel output. Others, however, attributed the latest decline largely to the absence of Chinese buyers during the holiday period and expect demand to pick up once market participants return towards the end of next week.
An international market participant noted that the sharp fall in iron ore derivatives since the beginning of the holiday was likely linked to subdued holiday demand, which may have triggered algorithm-driven selling after prices crossed a certain threshold. Physical market activity remained thin, while concerns persisted over increasing spot availability and the resulting pressure on prices.
Further coke price cuts could provide some relief to steel mill margins and support lump demand. However, supply remains relatively ample in both the seaborne and portside markets.
DCE iron ore futures remain stable
January 2027 iron ore futures on the Dalian Commodity Exchange (DCE) were largely unchanged at RMB 702.5/t ($104.6/t) on 2 October, with trading activity remaining subdued as participants stayed away from the market during the Chinese holiday period.
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