05/02/2026
2026 Iron Ore Market Insight: Supply-Demand Dynamics and Cyclical Reshaping Amid High Inventory
Author: James Zhao, President of ETD (HK) CO., LTD https://etd.hk
Foreword: At the start of 2026, China's iron ore market exhibits complex characteristics of "high port arrivals, high inventory, and weak demand." Port inventory near historical peaks results from short-term supply-demand mismatches, global supply structural changes, and domestic policy adjustments.
I. Current Analysis: 150 Million Tons of Inventory Under Pressure
• Inventory Data: As of January 30, 2026, iron ore inventory at 35 major ports reached 153 million tons. In a broader scope, inventory at 45 ports reached 168 million tons by January 23, a 12.27% year-on-year increase.
• Port Clearance Pressure: Although daily clearance picked up slightly in late January, seasonal downward pressure persists as steel mills complete pre-holiday restocking.
II. Core Drivers: Why Port Inventory Continues to Accumulate?
1. Supply Side: Global shipments remain at historic highs, with total shipments increasing by 11.674 million tons as of January 16.
2. Demand Side: Structural shifts in real estate drag down steel consumption. Late Spring Festival holidays in 2026 also lead to a traditional construction off-season in January.
3. Policy Side: The new steel export licensing system implemented on January 1, 2026, has increased costs and lead times.
III. Future Outlook: Simandou Entry and Price Pivot Shift
• Simandou Project: In January 2026, the first vessel of high-grade ore from the Chinese-led Simandou project in Guinea arrived at port. This project’s 120 million ton annual capacity will enhance Chinese steel mills' bargaining power.
• Price Forecast: Market pivots are expected to shift downward to $90-$110 USD in H2 2026, with potential dips below $80 USD.
IV. Professional Empowerment: Finding Certainty in Change We offer supply chain optimization through real-time monitoring of 47 ports and tracking of international mines like Simandou.
