China: Iron ore spot Fe 61% prices decline by $2/dmt amid weak demand outlook

• Coke price hikes pressure Chinese steelmakers' margins
  
  
• Steel market lull, mill maintenance schedules cap demand
  
  

Iron ore fines (Fe 61%) spot prices fell by $1.5/dmt to $97.5/dmt CFR China d-o-d on 1 July 2026. The decline in iron ore prices was primarily driven by mounting pressure on mills' margins following the ninth round of coke price hikes, which led many mills to adopt a cautious procurement approach.

Weak profitability prompted several Chinese steelmakers to either announce maintenance shutdowns or consider production curbs for July, raising expectations of lower raw material consumption in the coming weeks.

Additionally, the traditional seasonal slowdown in China's steel market continued to weigh on sentiment. Persistent rainfall across key construction regions disrupted project activity and weakened steel consumption, keeping finished steel prices under pressure. Trading activity weakened further due to slower portside transactions, while seaborne trading also remained subdued.

Although steel production has already been moderating in recent weeks, the market appeared to further price in expectations of softer demand amid growing maintenance announcements and weak downstream steel consumption. Additional pressure came from concerns over gradually declining iron ore usage as more mills prepared for July maintenance schedules.

Meanwhile, supply-side concerns also emerged amid ongoing discussions over the possible prohibition of certain branded products by CMRG, adding another layer of uncertainty to the market.

DCE iron ore futures: Iron ore futures on the Dalian Commodity Exchange (DCE) for the September 2026 contract edged up slightly by RMB 6/t to RMB 749.5/t ($111/t) on 2 July.