Rising inventory and Vale SA's production exceeding expectations intensify supply concerns, leading to three consecutive declines in iron ore futures prices

As China's inventory continues to rise and Brazilian mining giant Vale SA's production exceeds expectations, concerns about oversupply in the market have intensified, leading to a third consecutive day of declines in iron ore prices. On Friday, iron ore futures fell by 1.7% to USD 97.90 per ton, and are expected to decline for the fifth consecutive week. If this happens, it will be the longest losing streak since June. Data shows that steel raw material inventory at Chinese ports increased by 0.5% from the previous week, reaching approximately 161 million tons. Inventory has risen for 11 consecutive weeks, approaching historical highs. This accumulation of inventory marks a shift from the relatively low inventory levels at Chinese ports in recent years, highlighting that supply growth has outpaced demand. Additionally, with the Lunar New Year holiday approaching next week, consumption typically slows down. Meanwhile, Vale SA, one of the world's largest miners, stated on Friday that its iron ore production for the last quarter was 90.4 million tons, exceeding analyst expectations; annual production also surpassed guidance and outperformed competitor Rio Tinto. Increased supply from Australia and Brazil, coupled with weak demand, continues to exert pressure on iron ore prices. Year-to-date, iron ore prices have fallen by approximately 7%