Iron ore futures prices edged lower on Thursday, pressured by soft demand from China’s manufacturing and infrastructure sectors, though inventory replenishment ahead of the Chinese national day holiday capped losses.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) TIO1! was down 0.12% at 800 yuan ($112.55) a metric ton.
The benchmark September iron ore (SZZFU5) on the Singapore Exchange traded 0.19% lower to $105.25 a ton, as of 0713 GMT.
On the demand side, manufacturing and infrastructure investment continued to register negative year-on-year growth in August, while end-use steel demand fell sharply in the third quarter, compared with the 7% year-on-year increase in manufacturing steel consumption in the first half of the year, said Chinese broker Galaxy Futures.
Still, upcoming inventory replenishment ahead of the Chinese national day holiday could lend support to the ferrous metals sector, Galaxy added.
Meanwhile with production restrictions lifting, hot metal output, a gauge of iron ore demand, increased month-on-month to 2.4055 million tons, said broker Everbright Futures.
On the supply end, China’s August crude iron ore output was up 8.8% year-on-year at 81.63 million metric tons, while shipments from top producer Brazil also increased in the third quarter.
Imported iron ore inventories at domestic blast-furnace steel mills rose for the third consecutive week, up 10.3% from the previous week according to data from Chinese consultancy Mysteel.
Broadly, the dollar index 
DXY, which measures the U.S. currency against six major peers, fell to the lowest since February 2022 immediately after the decision by the Federal Reserve to cut interest rates, but rebounded to 97.089.
A stronger greenback makes dollar-denominated assets less affordable to holders of other currencies.
Other steelmaking ingredients on the DCE lost ground, with coking coal NYMEX:ACT1! and coke (DCJcv1) down 2.11% and 1.1%, respectively.
All steel benchmarks on the Shanghai Futures Exchange slipped. Rebar 
RBF1! dipped 0.25%, hot-rolled coil EHR1! eased 0.89%, wire rod (SWRcv1) decreased 0.09% and stainless steel 
HRC1! edged 0.46% lower.
($1 = 7.1078 Chinese yuan)
