China: Iron ore spot prices slip to 3-week low amid weak margins

• Weak steel demand, mill losses weigh on iron ore buying
• Rising production cut expectations exert downward pressure

Iron ore fines (Fe 61%) spot prices declined by $1/dmt d-o-d to $95/dmt CFR China on 14 September 2026, the lowest level since 24 August, driven by subdued steel demand and weak mill profitability. Chinese buyers remained cautious amid falling finished steel prices, while growing expectations of production cuts added to concerns over near-term iron ore consumption.

Elevated coking coal prices have increased steelmaking costs, while slowing demand has restricted gains in finished steel prices, leaving mills with weaker margins. Expectations of production cuts among Chinese mills have also increased as producers look to contain losses. Mills expect lower operating rates to reduce demand for iron ore fines, with the possibility of broader production curbs becoming a growing concern for the seaborne market.

China’s iron ore portside prices declined for the third straight day as mills remained conservative in their raw-material purchases amid weakness in steel prices. Sellers continued to hold offers relatively firm, but buyers showed limited willingness to increase inventories while the market remained under downward pressure.

Traders were also reluctant to reduce selling levels despite weaker prices. Mills are already under margin pressure, while elevated prices for high-grade ore have further reduced buying appetite. Although import economics remain workable, expectations of softer demand and possible production cuts are encouraging mills to delay purchases.

The deterioration in steelmaker profitability, ample iron ore availability and weaker procurement continued to weigh on sentiment. Broader financial-market concerns, including expectations of a possible US Federal Reserve rate hike, added further pressure to market sentiment.

DCE iron ore futures remain under pressure

January 2027 iron ore futures on the Dalian Commodity Exchange (DCE) declined by RMB 1/t ($0.2/t) to RMB 711.5/t ($106/t) on 14 September against RMB 712.5/t ($106/t) on 11 September. The decline in futures reinforced the weaker tone in the physical market, while expectations of lower steel output, elevated freight costs and continued margin pressure kept Chinese buyers cautious.