Black market trading enters inventory pressure test, iron ore hits its seventh consecutive week of decline, marking the most severe downtrend since 2022.

The trading price of iron ore is heading towards a continuous seven-week weekly level decline - if it continues to fall for seven consecutive weeks by the end of Friday, it will be the worst continuous decline trend since 2022. Analysts believe that the core reason behind this is the seasonal weakening of iron ore demand and the narrowing of steel mill profit margins. On Friday, steel raw material futures traded in Singapore plummeted to $96.95 per ton, the lowest intraday level since February. Iron ore futures prices have fallen by 1.5% so far this week, with contract prices set to record a continuous two-month decline. From high port inventories to shrinking steel mill profits, coupled with the off-season steel demand and an increase in supply side expectations, iron ore has broken the $100 mark and the longest continuous decline warning in four years has been sounded, with pricing returning to demand reality in the black industry chain. In recent weeks, classic bulk commodity prices in the black series have been under pressure due to market concerns about seasonal demand weakening, increased shipping supply expectations after the reopening of the Strait of Hormuz, and high port inventories in China. In addition, after the United States and Iran reached a temporary peace agreement, global energy systems and fuel prices, as well as shipping costs, have plummeted, continuing to put pressure on the bulk commodity market. The decline in fuel costs does not hit demand, but rather reduces the transportation and shipping costs of miners, weakens geopolitical risk premiums, and makes the market more concerned about supply increases; when Chinese demand is weak and port inventories are high, it will pressure iron ore prices. "Miners are likely to significantly increase shipments in the last week of this month to meet the quarterly comprehensive guidance targets," said Kpler iron ore analyst Sushmita Vazirani. She was referring to Australian suppliers. "In addition, weak demand will limit prices." As shown in the chart above, iron ore futures prices are expected to set a record for the longest weekly decline since 2022. Furthermore, "a key supply monitoring point for July is the labor situation of BHP, the world's largest iron ore giant," Vazirani said in an interview. She was referring to ongoing negotiations between the Port Hedland port union and BHP around wages and working conditions. Port Hedland is the world's largest bulk iron ore export terminal. The monthly iron ore throughput of the integrated port area usually peaks in June, reaching an unprecedented record high of about 54.6 million tons in June last year. Meanwhile, in China, according to data compiled by Shanghai SteelHome E-Commerce Co., port iron ore inventories rose to 160 million tons this week. This is a record level for this time of year. China is the world's largest iron ore importing country. Chinese steel companies are also facing a new round of profit pressure. According to Mysteel's statistical data, the profit margin of surveyed steel mills has dropped to about 51%, down 4.8 percentage points from the previous week and 8.2 percentage points from the same period last year.