Australia's iron ore (62% Fe, CFR China) price on November 24 went up by US$0.55 to US$104.75, which marked a new high since early November. China’s steel market continues to face weak demand, but social inventories of the country’s five major steel products have fallen for six straight weeks, with the latest weekly decline widening. The reduction in inventories eased pressure in the market, supporting broad gains in ferrous futures and strengthening spot steel prices. Iron ore prices also climbed as environmental production restrictions in Hebei concluded.

According to market participants, China’s hot metal output increased after the National Day holiday. Although production dipped recently, levels remained high. Rigid demand kept iron ore prices strong. However, falling steel mill profits and more cautious procurement tempered sentiment. As a result, iron ore is expected to move in a volatile pattern in the near term.