Iron Ore Stays Below $100 as China Property Woes Weigh on Steel Demand

Iron ore futures traded at $99.10 per metric ton Wednesday morning according to Singapore Exchange data. The TSI 62% Fe CFR China Index Futures fell 0.10% from Tuesday’s close.

Trading data from TradingView confirms the commodity struggles below the critical $100 threshold. Technical indicators paint a bearish picture for the steel-making ingredient.

Price action remains trapped below both 50-day and 100-day moving averages on the daily chart. The Relative Strength Index sits at 60, showing neutral momentum without clear directional bias. MACD indicators flatten after previous bullish attempts, suggesting fading upward momentum.

Bollinger Bands display narrow ranges, indicating reduced volatility in recent sessions. Support levels emerge at $98.49 and $98.00, while resistance builds around $99.65 and $100.48.

The current price sits between the 78.6% Fibonacci level at $98.85 and the 38.2% level at $104.20. Chinese demand fundamentals continue weighing on market sentiment despite surprising steel production resilience.

Real estate investment dropped 10.1% year-over-year through September 2024, while new construction starts contracted 22.2%. Steel inventories reached just 11.6 million tonnes, marking the lowest seasonal level since 2016.

Steel mills shifted to just-in-time purchasing strategies, reducing average inventory levels to 28 days from 35 days in March. This change eliminates bulk buying urgency and contains price volatility. Combined inventories at Chinese ports reached 138 million metric tons, exceeding the 135 million ton threshold that typically triggers restocking.

Supply conditions remain stable across major exporters. Australian Pilbara shipments continue at 16.5 million tons weekly without disruption. Brazilian exports show no significant supply constraints affecting global markets.

Open interest on SGX futures stands at 277,590 contracts, indicating steady but cautious market participation. Trading volumes maintain consistent levels across major exchanges, though decisive moves await fresh demand signals.

UBS analysts maintain their $100 per ton average forecast for 2025 but project declines to $95 in 2026 and $90 in 2027. Trading Economics data shows iron ore decreased 3.44% since January, underperforming compared to precious metals gains.

The commodity reached an all-time high of $219.77 in July 2021 but faces persistent headwinds from Chinese property sector struggles. Steel production increased 1.1% year-over-year in Q1 2025, with daily output reaching 2.8 million tonnes in early May.

Market participants focus on upcoming Chinese manufacturing data for clearer direction. The current technical setup suggests continued range-bound trading between $98-$100 until fundamental catalysts emerge from China’s economic releases.

ETF flows remain minimal, reflecting institutional investors’ wait-and-see approach toward the world’s most important steel-making ingredient.

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