DCE iron ore futures continued to fluctuate downward today, main contract has hit the lowest 696 point this year. The spot quotation in the morning has decreased 5yuan/mt by some traders, then continued to lower the quotation during trading. Also some trades were not willing to quote today due to their pessimistic mind on iron ore price. Steel mills tend to buy on their demand, few buy in order to restock before mid-autumn festival. PBF at Shandong port dealt 920-925yuan/mt, decrease by 35-45yuan/mt; PBF at Tangshan port dealt 1000yuan/mt, decrease by 20-25yuan/mt; PBF at Jiangnei port dealt 950yuan/mt. After Guangxi, Jiangsu province, recently Yunnan province issued the energy-consumption policy that all steel mills should adjust their production sequence( proportion shouldn’t be less than 30% of monthly appraisal target) until the end of this year. Previously, 9 provinces including Qinghai, Ningxia, Guangxi, Guangxi, Fujian, Xinjiang, Yunnan, Shaanxi, Jiangsu province are listed high energy-consumption provinces, which marked level I warning. It expects that the production control for these places will likely to enhance in the following days. Additionally, according to SMM, some steel mills closed their part of BFs today to answer local energy-consumption control. Pig iron production will be expected to decrease this week under the background of production restriction, iron ore price will accordingly decrease to some extent.

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Source: Metals Market Index (MMi)