Iron Ore Prices and Supply Dynamics
Iron ore prices recorded gains for the third consecutive week, supported by resumed production at Chinese steel mills and supply concerns. Singapore Exchange (SGX) October benchmark iron ore contracts rose 0.54% to $106.05 per metric ton, while Dalian Commodity Exchange (DCE) January contracts edged slightly lower but still gained 1.6% weekly. Global iron ore shipments declined significantly, with Mysteel reporting a reduction of 800,600 tons week-on-week to 2.756 million tons during September 1–7. Australian and Brazilian shipments fell by 572,500 tons to 2.329 million tons.

Steel Demand and Inventory Pressures
Steel demand in China during the traditional "Golden September" period has underperformed expectations. Rebar social inventories rose to 4.8723 million tons, an increase of 18,570 tons week-on-week, with Hangzhou stocks exceeding winter storage levels. Rebar production fell by 67,500 tons to 2.1193 million tons, while table demand decreased by 40,000 tons to 1.9807 million tons. However, average daily hot metal output increased significantly by 5% to 2.41 million tons, reaching a three-week high as steel mills resumed operations after military parade restrictions eased.

Trade Measures and International Developments
The EU plans to introduce new long-term trade tools to restrict steel imports, as announced by European Commission President Ursula von der Leyen. These measures aim to protect EU steel producers from global overcapacity and replace existing safeguards set to expire in mid-2026. Meanwhile, the U.S. International Trade Commission (ITC) made affirmative injury determinations in its fourth sunset reviews of anti-dumping and countervailing duties on hot-rolled carbon steel from China, India, Indonesia, Thailand, and Ukraine, ensuring these trade measures remain in effect.

Sector Outlook
The steel market remains under pressure due to high inventory levels and weaker-than-expected seasonal demand. However, macroeconomic expectations are improving, with potential Fed rate cuts possibly providing more policy space for China. Steel prices may see limited downward space and could experience a modest rebound in late September.