Iron Ore Falls to Two-Year Low Under Dual Pressure of Weakening Demand and Rising Supply
nashnova research
Singapore iron ore futures fell as much as 1.4% to $89.25 a ton, the lowest since September 2024; China's seasonal slowdown and rising miner shipments leave little room for a rebound this quarter.
How far has it fallen?
Singapore benchmark futures dropped as much as 1.4% to $89.25 a ton — the lowest intraday level since September 2024.
Dalian iron ore futures hit a two-year low in tandem; as of 10:45 a.m. Singapore time, the contract traded at $89.40, down 1.2%.
This means → iron ore has broken below the $90 psychological floor, and the market is now testing lower support.
What is happening on the demand side?
China is entering its seasonal steel-consumption lull — the final two months of the year are historically the weakest for steel use.
Elevated oil prices are stoking concern over the global growth outlook, removing a potential catalyst for an iron ore rebound.
Steel mills have turned cautious on restocking, operating on a "hand-to-mouth" basis, and their sensitivity to macro stimulus has faded noticeably.
In plain terms = end-users are not stockpiling and not betting on policy; they buy only what they need right now, so there is no upward pull from demand.
What is adding pressure on the supply side?
The Big Four miners — including Rio Tinto and BHP — are expected to ship up to 18 million additional tons of iron ore in Q4.
Guinea's Simandou mine, a massive new deposit still ramping up, continues to add supply.
This means → supply is expanding at the same time demand is contracting — prices are being squeezed from both ends.
Why has the negotiation premium disappeared?
Earlier, a standoff between China Mineral Resources Group (CMRG) — the state-backed iron ore buyer — and major miners had injected a supply-risk premium into the market.
That premium has largely evaporated as deals, including one with Rio Tinto, have been struck.
However, talks between Australia's Fortescue and CMRG have yet to make progress.
In plain terms = the market had been paying extra because it feared supply disruptions from stalled negotiations; now that most deals are done, the fear premium is gone.
What comes next?
Jiang Mengtian, chief ferrous-metals analyst at Horizon Insights, expects iron ore to stay weak through November, with room to slide further to $85–86 a ton.
High port inventories are the key backdrop — the fuller the stockpiles, the less urgency mills feel to buy, and the harder it is for prices to rebound.
Whether the $85 level holds will be the critical test of where Q4 demand truly bottoms out.
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