SGX TSI 62% Fe iron ore futures are trading at approximately $97 per ton CFR China as of late June 2026, having broken below the key $100/t psychological level. China onshore futures are at CNY 735-740/t, the lowest since July 2025. TradingEconomics reports the CFD benchmark tracking the Chinese market at 735 CNY/t on June 25, with prices in decline amid ample supply and weakening steel demand.
The fundamental story is straightforward: Chinese steel demand has deteriorated significantly. Mysteel data shows a worsening consumption environment, with both steel production and consumption constrained as mills struggle with high energy costs and poor margins. Finished steel inventories are drawing, but this reflects production cuts more than demand strength — steel output fell as mills reduced utilization in response to negative margins.
Iron ore port inventories in China have climbed to record highs, reflecting a market where supply continues to arrive while consumption stalls. China's iron ore imports fell nearly 6% in May compared to April, consistent with mills buying only for immediate needs. The destocking pattern suggests downstream buyers have no confidence in near-term demand recovery.
On the supply side, new capacity is adding to the glut. The Simandou project in Guinea began contributing significant volumes from late 2025 into 2026, adding high-grade ore to an already well-supplied market. Australian and Brazilian shipments remain at elevated levels, ensuring that any demand uptick can be easily met from existing port stocks.
Earlier in 2026, iron ore had traded higher (around CNY 760/t) on hopes of a Chinese steel demand recovery driven by infrastructure stimulus. Those hopes have faded as the stimulus measures have been more targeted than broad-based. The path to a recovery in iron ore prices runs through Chinese steel mill margins: until those improve and mills begin restocking, the downtrend is intact.
This is the most favorable pricing environment for iron ore buyers since mid-2025. The $90-95/t zone is the next support level. Do not rush to cover long-term requirements at current levels — port inventories are at records and there is no imminent supply disruption. If you have a spot purchase coming due, the market is likely to remain weak through Q3 2026 as Chinese steel production enters its seasonal low period. The catalyst to watch is Chinese infrastructure stimulus: any significant package would shift the demand outlook quickly.