The decline in iron ore and steel prices in China's domestic markets, particularly on October 22, 2026, is notable. According to data, the price of iron ore on the Dalian Commodity Exchange (DCE) fell by 1.83% to 669.0 yuan per ton. Additionally, the price of all eight products at the port of Qingdao also decreased by 9 yuan per ton.
Price Drop in Maritime Markets
In maritime markets, the iron ore index for 61% grade has decreased to $88.60 per ton, and for 65% grade to $106.25. This price drop indicates that isolated improvements in offers have not been able to create a sustainable momentum for price increases. Meanwhile, hot metal production has seen a slight increase.
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Increase in Production and Existing Challenges
Daily hot metal production reached 2.3584 million tons on October 21, an increase of 6,400 tons compared to the previous period. This increase has been accompanied by a slight rise in blast furnace utilization rates. However, the increase in production does not imply voluntary stockpiling; as inventories at factories, end-user orders, and margins still affect purchasing timelines.
A decrease in incoming flows may reduce supply pressure in the future, but existing inventories still require transactions and collection to attract. The short-term question is whether lower prices will create sustainable demand. Limited purchases for current consumption may soften prices and keep them within range, while stable trading and stockpiling could help convert production improvements into price support.
Increased transportation costs have introduced a new cost variable, making selling prices, supply contracts, and exchange rates important factors for margin assessment. Thus, a one-day trend in production or price change cannot be considered a reversal of the trend.
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