Iron Ore, Coal and Steel: SGX, Dalian, Newcastle — 2026-09-26
Iron ore proxies weakened this week as soft Chinese steel demand outweighed pre-holiday restocking ahead of the National Day break, with Vale and Rio Tinto shares falling on September 23–24. Dalian futures hovered near month lows around CNY 710/tonne amid rising port stocks and widespread steel mill losses, while Bloomberg reported China's coking coal supply squeeze will linger into 2027. Global crude steel output fell 1.2% year-on-year in August, per worldsteel, capping any price upside.
Iron Ore, Coal and Steel: SGX, Dalian, Newcastle — 2026-09-26
Top developments
Vale slides as Chinese steel demand stays soft
On Wednesday, September 23, 2026, Vale lost 2.61% to US$13.82 and Rio Tinto fell 2.30% as Chinese steel demand showed no recovery, with pre-holiday restocking failing to lift the tone. Vale slipped a further 1.88% on Thursday, September 24, as weak steel demand again outweighed Dalian restocking activity. This matters for SGX iron ore proxies and the miners exposed to Chinese mill margins, which remain too thin to sustain a demand-led rally.
Dalian iron ore near one-month lows at CNY 710
Chinese iron ore futures oscillated near one-month lows around CNY 710 per tonne, pressured by comfortable supply, rising port inventories and growing steel mill losses, even as National Day restocking expectations offered some support — an earlier Reuters-linked report also noted prices fell on worsening demand outlook. For the DCE most-traded contract and related Singapore swaps, this confirms fundamentals remain weak heading into the holiday.
China's coking coal squeeze seen lingering into 2027
Bloomberg reported on September 23, 2026 that China's coking coal supply squeeze is set to persist into next year, supporting strong import demand even as efforts to revive domestic output may cool prices. Ferrous markets showed clear divergence this week, with raw materials — including coking coal and coke — outperforming finished steel, per SMM's weekly review. This is directly relevant to Newcastle-linked metallurgical flows and Chinese mill cost structures.
Global crude steel output fell 1.2% in August
Worldsteel data published this week showed global crude steel production fell 1.2% in August 2026 versus the previous year, reinforcing the demand headwind for iron ore and steelmaking raw materials. Weak Chinese demand, hit by the property downturn, and rising global supply are expected to keep the commodity under pressure, limiting another rally above US$100/tonne.
Higher freight costs squeeze Brazilian iron ore exports
On September 24, 2026, industry association Inda said rising freight costs are pressuring Brazil's iron ore exports, per Reuters. Separately, Brazilian steel pre-holiday-related mills face the same weak-demand environment. Rising freight raises delivered costs into China — a bullish cap-support factor for Singapore-indexed prices even as headline demand softens.
Local view
Chinese-language commentary this week emphasized a tug-of-war between reduced port arrivals and pre-holiday restocking: Hongyuan Futures noted the i2701 Dalian contract closed at 715.5 yuan/tonne with i2705 at 706 yuan, Qingdao Port PB fines at 678 (-5) yuan/tonne, and PB fines assessed as the optimal deliverable grade at 710 yuan in warehouse-receipt terms — framing the market as "bulls and bears intertwined, oscillating." Chinese steel market trackers (Zhonglian Steel) reported domestic steel prices showing narrow-range divergence with rebar -0.26%, hot-rolled coil -0.18%, iron ore +0.07%, coke -0.93% and coking coal -1.67% in a single session, as pre-holiday restocking improved market transactions. In Brazil, Valor Econômico reported iron ore stable on the Dalian exchange on September 24, 2026.
Context & numbers
- Dalian most-active iron ore (i2701): 715.5 yuan/tonne; PB fines at Qingdao: 678 yuan/tonne — Hongyuan Futures, September 23
- CNY ~710/tonne futures near one-month lows; port inventories rising, steel mill losses widespread
- Vale: US$13.82 (-2.61%) on Sept 23; Rio Tinto -2.30%
- Newcastle thermal coal (6000 kcal benchmark): US$144.00/tonne observed September 19, 2026
- Global crude steel output (70 countries): -1.2% y/y in August 2026
On the radar
- China's National Day holiday restocking window: watch whether Dalian open interest and mill sintering rates hold up after the break, as restocking demand fades in October
- Coking coal: monitor whether Beijing's push to revive domestic output cools import prices through 2027, per Bloomberg's supply-squeeze outlook
- Brazilian export economics: rising freight costs flagged by Inda could tighten seaborne supply economics into Q4
- October worldsteel monthly data: whether September Chinese output extends August's -1.2% decline will frame iron ore demand expectations
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