Australia's iron ore (62% Fe, CFR China) price on January 16 remained almost flat at US$106.55 compared with the previous day. Spot steel prices in China edged higher last week, recording modest gains, while ferrous commodities continued to show weakness. Coking coal and coke futures both moved lower. Meanwhile, inventories at Chinese ports continued to rise, surpassing 170 million tons, and steel mill inventories also increased to more than 90 million tons, creating pressure on iron ore prices. However, the People’s Bank of China’s implementation of a targeted reserve requirement ratio (RRR) cut is expected to limit the overall impact on the iron ore market.

Market participants said that with severe cold weather affecting China, the steel market is firmly in its seasonal off-peak period, and end-user demand remains weak. At the same time, supportive macroeconomic policies continue to provide backing. In addition, after earlier maintenance periods, some blast furnaces at steel mills have gradually resumed operations, resulting in higher hot metal output. Against this backdrop, iron ore prices are expected to fluctuate within a narrow range in the short term.