- Narrowing discounts support market recovery
- DCE futures ease amid cautious sentiment
Iron ore fines (Fe 61%) spot prices edged up by $1/dmt d-o-d to $91/dmt CFR North China on 12 October 2026, compared with $90/dmt on 9 October. The market reopened on a slightly firmer note, supported by improving sentiment and narrowing discounts, particularly for Pilbara Blend Fines (PBF).
Market participants indicated that persistently low derivative prices and expectations of further coke price cuts could provide some relief to steel mill margins. This may support a gradual narrowing of iron ore discounts, particularly for PBF, and improve market sentiment in the near term.
However, the recovery remains constrained by negative import margins and ample portside inventories, despite some destocking. Weak import economics and oversupply continue to limit the scope for a sustained price rebound, keeping the market outlook cautious.
DCE futures ease amid cautious sentiment
January 2027 iron ore futures on the Dalian Commodity Exchange (DCE) edged down by RMB 1.5/t ($0.22/t) to RMB 682.5/t ($102/t) on 12 October 2026. The marginal decline reflected cautious sentiment and limited trading momentum, despite a slight recovery in the spot market. Persistent supply overhang at Chinese ports and negative import margins continued to weigh on market confidence. While narrowing spot discounts and the possibility of lower coke prices could offer some support, the futures market remained subdued, suggesting that expectations of a sustained recovery remain limited.
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