SGX iron ore futures largely flatlined on June 9, settling at $102 per metric ton with just a 0.04% gain, as the market weighed expanding seaborne supply against deteriorating Chinese steel demand. The trading range has narrowed to $98–$105 over the past two weeks, reflecting the fundamental standoff between supply growth and demand contraction.
Chinese steel demand, which accounts for over 60% of global iron ore consumption, has shown signs of accelerating weakness. Apparent consumption of five major steel products fell 3.1% week-on-week in early June, following a 0.5% decline the prior week. Persistent rainfall and early-season heat have curtailed construction activity, while the property sector remains in a structural downturn.
On the supply side, the market is absorbing the early impact of Guinea’s Simandou project. First shipments from Simandou began in November 2025, and output is expected to reach approximately 20 million tonnes in 2026 as the operation ramps up toward its eventual capacity of 120 million tonnes per year by 2030. Simandou’s high-grade (65%+ Fe) low-impurity ore is expected to compete directly with Australian and Brazilian premium products.
Analyst consensus for 2026 iron ore prices has converged around $90–$100/t, with bearish forecasts targeting $85/t. Citi forecasts $85/t, Goldman Sachs $93/t, JP Morgan and BMI $95/t, and Vale’s internal guidance assumes $100/t. The wide range reflects uncertainty about the pace of Chinese steel demand decline and the speed of Simandou’s ramp-up.
Iron ore buyers should prepare for a softening market through H2 2026. The combination of Chinese demand weakness and Simandou supply growth is bearish for prices. Consider delaying H2 procurement where possible, as prices are likely to trend toward $90–$95/t. Fixed-price contracts may underperform index-linked pricing in this environment.