Iron Ore Extends Fall on Rising Supply

Iron ore futures fell toward CNY 750 per ton, touching a five-month low as the massive Simandou project in Guinea shipped its first ore, raising expectations of increased global supply at a time when demand in top consumer China is weakening. The project is expected to produce 120 million tons of iron ore annually, chipping away at the global share of top suppliers Australia and Brazil. In addition, the China Iron and Steel Association recently met with major domestic miners and regulators to discuss expanding the country’s iron ore output. Meanwhile, data showed China’s iron ore imports declined for a second straight month in November as demand softened, with several steel mills reducing activity for equipment maintenance amid thinning margins. China imported 110.54 million metric tons of iron ore in November, down from 111.3 million tons in October but above the 101.86 million tons recorded a year earlier.

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