In August 2025, the iron ore market was marked by increased volatility, but by the end of the month prices returned to levels close to July. January futures on the Dalian Exchange (DCE) as of September 1 were recorded at $107.9/t, which is only 0.2% more than at the beginning of August, while on the Singapore Exchange October contracts amounted to $101.35/t, down 0.4% over the month. This indicates that despite active fluctuations, the market ended August in relative balance.
The main factor influencing prices remained restrictions on steel production in China. Since mid-August, Tangshan and Henan have been mass-shuttling blast furnaces and reducing sinter output by 30-50% due to environmental requirements and preparations for a military parade in Beijing. This has sharply reduced iron ore consumption, putting pressure on quotations.At the same time, there was no shortage of supporting factors. The temporary suspension of work at the Simandou mining project in Guinea has raised concerns about future supplies of high-quality ore, which has fueled demand in the second half of August. Speculation about a possible rate cut by the US Federal Reserve, which could increase investor appetite for raw materials, provided an additional stimulus. Such news temporarily lifted prices above $102-104/t on the Singapore Exchange.Demand volatility has also generated mixed sentiment. On the one hand, data from the China Iron and Steel Association (CISA) showed an increase in iron and steel production in August, which supported the market. On the other hand, high finished steel inventories and a weak construction sector continued to put pressure on prices, forcing traders to act cautiously.Overall, August can be described as a month of balancing between the negative impact of production restrictions and positive news from the supply side. This led to the fact that the average monthly fluctuations did not change the overall trend - the market remained in the range of $98-104/t.
Source: https://gmk.center/ua/news/cini-na-zaliznu-rudu-v-serpni-zberegli-rivnovagu-popri-volatilnist-rinku/
