Iron ore is the world’s most important industrial metal: without the ferrous rock, no crude steel could be produced, and without steel, modern infrastructure would grind to a halt. From blast furnaces to wind turbines – the value chain begins in the mine. This page provides all relevant information on the global iron ore price and clearly explains the most important influencing factors in the long term.
The iron ore price is based on the benchmark for 62% Fe, which is traded on exchanges such as the SGX and CME. Since the beginning of 2025, the price has been moving in a range around US$100 per ton, characterized by weak steel demand, robust Chinese imports and concerns about additional supply from new major projects. Currency fluctuations, freight rates and political risks in producing countries increase volatility.
The current market phase is characterized by seemingly contradictory signals. While the spot price for 62% material temporarily fell below the 95 US dollar mark in mid-June 2025, Chinese buyers are ordering more ore than since December 2024: Imports of around 110 million tons are expected for June. The impetus comes less from new steel demand than from inventory build-up, as low prices and low port stocks open up scope for use. At the same time, the West African mega-project Simandou is approaching its start-up phase, which should bring additional quantities into seaborne trade from 2026. From the perspective of the coming quarters, the market will therefore remain well supplied; price peaks could at best result from weather-related export failures in Australia or Brazil.
The lion’s share of the mined iron ore is processed into pig iron and then into steel – the indispensable material for construction, mechanical engineering, vehicle and energy systems. In addition, iron ore is used to produce intermediate products such as sinter and pellets, which form the basis for more climate-friendly sponge iron in direct reduction plants. Individual special grades are also used in pigments and catalysts.
Construction and infrastructure projects devour the largest part of global steel production. Supporting structures for high-rise buildings, tunnel linings, bridges, reinforcing steel for concrete as well as rail and port facilities are based on pig iron from iron ore. The constant urbanization in emerging countries ensures that this demand remains high in the long term, even if regional economic cycles fluctuate.
From the body to axles to gearbox housings, vehicle construction relies on steel-produced semi-finished products. Lightweight construction concepts reduce the specific weight, but steel remains unrivaled in terms of price due to its strength, availability and recyclability. Iron ore thus forms the basis for millions of vehicles that roll off the production line worldwide every year.
Whether machine tools, agricultural technology or conveyor belts: Mechanical engineering requires high-strength steels in countless grades. Here, iron ore is indirectly processed into components with high wear and temperature resistance. Without a stable steel supply, complex industrial plants and thus large parts of global manufacturing would not be competitive, and technological development would come to a noticeable standstill worldwide.
Wind turbines, solar panel frames and the housings of electrolyzers are largely made of steel. Particularly corrosion-resistant grades are required for offshore wind farms, the origin of which also lies in ore. As the global expansion of renewable energies is picking up speed, the demand for high-quality iron ore will continue to increase noticeably in the coming years.
Finely ground and high-purity iron ore serves as a starting material for iron oxide pigments in paints, plastics and cosmetics. In the chemical industry, iron also acts as a catalyst, for example in ammonia synthesis. Small in terms of quantity, but qualitatively demanding, these niches open up additional added value for the ore away from the steel route and stabilize overall market demand to a certain extent in the long term.
On the production side, Australia and Brazil dominate with a combined share of around two-thirds of global seaborne deliveries. In the Pilbara region, BHP, Rio Tinto and Fortescue extract extremely cost-effectively high-grade material on state-of-the-art, largely automated mining areas. In Brazil, Vale focuses primarily on the deposits in the state of Pará and is investing heavily in dry processing to increase Fe grades and reduce residues. Although China remains the largest ore producer in terms of quantity, it predominantly produces low-grade material for its own use. India, South Africa, Canada and Sweden contribute smaller, but qualitatively important volumes. From 2026, Simandou in Guinea is expected to join as a new, large-volume exporter and intensify competition in supply.
On the demand side, China is the undisputed leader, importing around three-quarters of seaborne iron ore. The dominant position results from the sheer size of the Chinese steel industry, which in turn is closely linked to the construction and infrastructure sector. This is followed by Japan and South Korea, whose ultra-modern blast furnaces require high-quality pellet blends. The European Union and Turkey also import considerable quantities, but are increasingly faced with CO₂ regulations, which lead to more direct reduction and thus higher requirements for ore purity. In India, demand is growing despite its own production due to rapid industrialization, while in Southeast Asia – for example in Vietnam and Malaysia – new flat steel plants are creating additional demand.
There is no way for investors to store physical iron ore in small quantities; instead, futures exchanges such as the Singapore Exchange or the CME serve as access. There, futures or options on the 62% Fe benchmark can be traded, which enable direct participation in the price and are often used by steel manufacturers for hedging. However, investors can also support speculative strategies.
Alternatively, listed mining companies, exchange-traded commodities (ETCs) or broadly diversified commodity funds offer indirect exposure. Opportunities from production increases and dividends should be weighed against potential risks such as currency volatility, regulatory intervention or environmental requirements. In particular, project developers in border regions have high fluctuations and financing hurdles that only experienced investors can cope with due to the long time horizon.
In the news segment, we continuously bundle reports on price movements, funding projects, trade statistics and political framework conditions relating to iron ore. This gives readers an up-to-date overview of how market factors such as Chinese import policy, mine closures, logistics bottlenecks or climate regulations affect supply, demand and ultimately the price, and how short- to medium-term trends can be classified.
The spot price is based on supply and demand in seaborne trade. The main drivers are Chinese steel output, production costs and short-term supply interruptions in Australia or Brazil. Freight costs, exchange rates and political decisions – such as environmental regulations or export duties – also influence prices. In addition, expectations about economic stimulus programs, inventory build-up at Chinese ports and technological changes in the steel sector have an impact on pricing.
Steel is indispensable for wind turbines, solar module frames or hydrogen electrolyzers. High-quality iron ore with a high iron and low pollutant content enables efficient direct reduction, in which producers use natural gas or green hydrogen instead of coking coal. Thus, high-quality ore supports the transition to lower-CO₂ steel processes and infrastructure worldwide and indirectly reduces the industry’s CO₂ footprint in the long term.
The most important parameters are iron content, moisture, phosphorus and sulfur content as well as gangue minerals. High-grade Fe > 65% is often preferred as pellet or lump because it delivers higher yields and lower emissions in the blast furnace. Low-grade ore <58% however, requires processing steps such as beneficiation or agglomeration, which has a noticeable negative impact on production costs and the CO₂ balance.
Seagoing vessels are the backbone of the international iron ore flow. Typically, Capesize freighters with 180,000 dwt are shipped from the Australian Pilbara port or Brazilian Ponta da Madeira to China. Trains and inland vessels are also used for shorter distances in Europe. Loading and unloading infrastructure significantly influence logistical costs and partially determine trade flows.
In the longer term, supply will grow through new mine projects in Guinea, Canada or India and ongoing capacity expansions in Australia. On the demand side, China’s steel production is likely to stagnate in the medium term, while India and Southeast Asia will increase. At the same time, decarbonization is promoting a shift to qualitatively higher-grade ore and direct reduction, which should create new price structures and trade patterns.
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