Issue 02, 2025 - This week's editorial: Sluggish demand depresses Asian prices, EU safeguard review heats up

Iron ore and coking coal prices fell last week to their lowest levels since September, as did Chinese hot rolled coil, amid softening demand expectations in China as economic uncertainty persisted. Trading remained slow globally as the market sluggishly returned from year-end holidays, while buyers exercised caution given much of Asia will soon observe the Lunar New Year. Italian authorities meanwhile received binding offers for the acquisition of Acciaierie d'Italia, including from Baku Steel, while Eurofer was reported to have recommended to the European Commission as part of its safeguard measure review that quota volumes should be reduced and duty rates increased.

The KORE 62% Fe index dropped to a 3.5-month low of $93.73/tonne cfr China on 7 January after US President-elect Donald Trump denied rumours he planned to scale back proposed US tariffs. The Federal Reserve was also expected to halt interest rate cuts in the coming months, strengthening the dollar and further pressuring commodity prices.

Coking coal fell below $200/t fob Australia amid the bearish Chinese market – which saw its sixth round of domestic coke price cuts – as well as excess supply. There was some optimism, though, that Indian buying interest would return ahead of potential restrictions on metallurgical coal imports.

Chinese domestic HRC prices were depressed by steel futures market weakness and growing inventory, while export values saw additional pressure from the yuan depreciation, reaching $480/t fob China for SAE 1006 HRC. Trading activity improved amid Vietnamese buyers’ restocking before the Chinese New Year, but deals occurred at lossmaking prices.

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