Prices consolidate below $100/mt as the iron ore market digests a convergence of bearish structural forces: record Chinese port inventories at 160 Mt (Trading Economics, Jul 6), accelerating Simandou 65% Fe supply reshaping grade premiums, and persistent weakness in Chinese steel demand (May crude steel -2.7% YoY, worldsteel). SGX TIO=F settled at $98.30/mt on July 6, essentially flat week-on-week (+0.05%) yet hovering at 10-month lows after seven consecutive weekly declines through June. Seaborne supply from Australia and Brazil continues to build (June shipments elevated), while mills maintain low-stock procurement strategies, buying only on price dips. The EU's new steel import quota regime (effective July 1, 2026 capping duty-free imports at 18.3 Mt, with 50% tariff above) adds an additional demand-side headwind for seaborne iron ore. The path of least resistance remains lower, constrained by surplus dynamics and weak demand — but a floor is forming around $95 as production costs for marginal Chinese domestic ore provide support.
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