Core Viewpoint - The recent halt of iron ore orders by China Mineral Resources Group from Australia signifies a shift in power dynamics in the iron ore market, indicating a potential change in pricing and supply chain control [1][5][12]. Group 1: Market Dynamics - In 2025, Australia's annual iron ore exports to China are valued at AUD 116 billion, yet the pricing power remains with Australian companies, highlighting a disparity in negotiation strength [3][5]. - Chinese steel mills have historically faced challenges due to fragmented purchasing strategies, allowing Australian miners to maintain control over pricing [3][5]. - The establishment of the China Mineral Resources Group in 2022 consolidated procurement, enhancing negotiation power and reducing the historical fragmentation among Chinese steel producers [5][12]. Group 2: Supply Chain Changes - China's iron ore imports from Australia exceeded 700 million tons in 2023, with similar expectations for 2025, indicating a strong bargaining position due to volume [5][6]. - New supply sources are emerging, such as the Simandou project in Guinea, which is expected to produce 120 million tons annually by the end of 2025, and increasing contributions from Brazil and Russia [6][9]. - The shift towards a diversified supply chain is gradually diminishing Australia's monopoly in the iron ore market [6][12]. Group 3: Currency and Settlement - The iron ore trade, valued at over USD 200 billion annually, has traditionally been settled in USD, but there is a growing push from China to use RMB, aiming to reduce reliance on the dollar [8][10]. - An agreement was reached on October 9, 2025, for 30% of spot trades to be settled in RMB, marking a significant shift in trade practices [9][10]. - The transition to RMB settlement could potentially save China USD 20 billion annually in exchange losses, reinforcing the domestic industrial chain [8][10]. Group 4: Historical Context and Future Outlook - The historical trade relationship between Australia and China, which began over a century ago, is at a turning point with the recent developments in trade practices and currency usage [1][12]. - The ongoing changes in the iron ore market reflect broader shifts in global commodity trading, with implications for future trade dynamics and currency preferences [10][12]. - The competitive landscape is evolving, and the ability to adapt to these changes will determine the future success of both Australian and Chinese stakeholders in the iron ore market [14].

Core Viewpoint - The decision by a Chinese mineral company to suspend iron ore orders in Australian dollars marks a significant shift in the iron ore trade, indicating China's move towards reducing reliance on the US dollar for transactions [1][2][6]. Group 1: Trade Dynamics - China's suspension of dollar-denominated orders reflects its desire for greater control over pricing and settlement methods in the iron ore market [6][12]. - Australia has historically dominated the iron ore trade, but China's changing procurement strategy, including diversifying sources from Africa, South America, and Russia, threatens this dominance [8][10]. - The shift to renminbi settlement is not merely a currency change but a strategic move to mitigate risks associated with dollar-based transactions [6][11]. Group 2: Australian Concerns - Australia's strong reaction stems from fears of losing its leading position in the iron ore market, as China is no longer a "unconditional buyer" [8][10]. - The Australian government is concerned that accepting renminbi could diminish its negotiating power in future transactions [10][12]. - Australia's reliance on iron ore exports makes it vulnerable, as it lacks other significant resources to offer [10][12]. Group 3: Future Implications - The move towards renminbi settlement could extend to other commodities, potentially reshaping global resource market dynamics [11][12]. - China's approach aims to create a more sustainable and controllable trading environment, which could lead to a reconfiguration of global trade rules [12][13]. - Both countries need to adapt to these changes to maintain a cooperative relationship, as resistance may lead to Australia becoming more passive in future negotiations [13].

Core Insights - The proportion of iron ore trade settled in RMB has surged from 5% in 2023 to 25%-28% in 2025, indicating a significant shift in the global mining industry dynamics [1][3] - BHP, previously adamant about dollar settlements, has agreed to settle 30% of its spot iron ore transactions in RMB starting from Q4 2025, reflecting China's growing influence as the largest buyer [3][31] - The shift in settlement currency is a result of China's strategic moves to consolidate purchasing power and diversify supply sources, allowing it to negotiate better terms with mining companies [19][21][39] Group 1: Market Dynamics - The average profit margin for major Chinese steel mills is only 0.71% in 2024, highlighting the challenging profitability landscape in the steel industry [6] - BHP's cost to extract iron ore is approximately $19 per ton, while it sells to China at prices significantly higher, leading to substantial profits for Australian companies [6][12] - China imports over 1.2 billion tons of iron ore annually, accounting for more than 70% of global demand, which has historically forced it to accept unfavorable terms [8][12] Group 2: Strategic Developments - In 2022, China established a mineral resources group to consolidate procurement from major steel companies, capturing 40% of domestic iron ore orders and enhancing bargaining power [19] - China has invested in infrastructure projects in Brazil, such as the "Northern Corridor" railway, reducing transportation costs by 30% and increasing the share of Brazilian iron ore imports settled in RMB [21] - The development of the Simandou iron ore project in Guinea, with reserves exceeding 2.25 billion tons, is expected to significantly contribute to China's iron ore supply by 2026 [23] Group 3: Currency Settlement Changes - China has signed currency swap agreements with 42 countries, totaling over 4.1 trillion yuan, facilitating direct RMB settlements in trade [25] - Following BHP's agreement to RMB settlements, other mining companies like Rio Tinto and FMG are also increasing their RMB transaction volumes, indicating a broader trend [35] - The trading volume of RMB-denominated iron ore futures on the Shanghai Futures Exchange has increased by 40% year-on-year, reflecting growing acceptance of RMB in commodity trading [35] Group 4: Implications for Global Trade - The recent negotiations mark a pivotal moment in global commodity trading, with China transitioning from a passive buyer to a key player capable of setting terms [36][41] - Analysts predict that by 2030, the proportion of commodities settled in RMB could reach 30%, signaling a potential shift in the dominance of the dollar in global trade [38] - The changes in settlement practices are not aimed at replacing the dollar but rather at establishing a more equitable trading environment where both buyers and sellers can negotiate on equal footing [42]

Report Information - Report Type: Iron Ore Daily Review [1] - Date: October 17, 2025 [2] - Research Team: Black Metal Research Team [3] - Researchers: Zhai Hepan, Nie Jiayi, Feng Zeren [3] 1. Report Industry Investment Rating - Not provided in the report 2. Report's Core View - On October 16, the iron ore futures main contract 2601 oscillated weakly, closing at 773.5 yuan/ton, down 0.90%. With the confirmation of the negotiation rumor between Sinomine Group and BHP and the escalation of Sino-US tariff disputes in the macro market, the price may oscillate weakly but is expected to remain within the oscillation range since August. Attention should be paid to the repair of downstream demand [7][11] 3. Summary by Relevant Catalogs 3.1 Market Quotes Review and Future Outlook 3.1.1 Futures and Spot Market Conditions - On October 16, the main iron ore futures contract 2601 oscillated weakly, opening lower and then oscillating, closing at 773.5 yuan/ton, down 0.90%. The trading volume was 398,551 lots, and the open interest was 535,578 lots, an increase of 27,213 lots. The net inflow of funds was 293 million yuan [5][7] - The main iron ore outer - market quotes and the prices of main - grade iron ore at Qingdao Port remained flat compared with the previous trading day [9] 3.1.2 Technical Analysis - The daily KDJ indicator of the iron ore 2601 contract continued to decline after a death - cross on the previous trading day; the green bar of the daily MACD indicator of the iron ore 2601 has been expanding for 3 consecutive trading days [9] 3.1.3 Future Outlook - BHP will change 30% of the amount in iron ore spot transactions with China to be settled in RMB from the fourth quarter of 2025, and will set an observation period for long - term contracts in 2026, still denominated in US dollars for now [10] - In terms of supply, the shipments and arrivals from Australia and Brazil increased in September, affected by end - of - quarter impulse. Shipments are expected to decline in October, and the recent significant increase in arrivals is expected to gradually fall back [11] - In terms of demand, the daily average pig iron output is still above 240,000 tons but has declined slightly for 3 consecutive weeks. Considering the continuous narrowing of steel production profits, the growth space of subsequent output is limited and may oscillate and decline around 240,000 tons in the short term [11] - In terms of inventory, steel mills increased their pre - holiday restocking efforts, and the iron ore inventory of steel mills continued to grow, which is expected to gradually fall back after the holiday and return to the state of restocking on demand [11] 3.2 Industry News - On October 16, the central bank carried out 236 billion yuan of 7 - day reverse repurchase operations at a fixed - rate and quantity - tender method, with an operating rate of 1.40%. With 612 billion yuan of reverse repurchases maturing on the same day, the net withdrawal was 376 billion yuan [12] - The Ministry of Commerce will carry out work in aspects such as releasing policy effectiveness, promoting trade, and deepening trade cooperation, including implementing existing foreign trade policies, strengthening service guarantees for foreign trade enterprises, and making policy reserves [12] 3.3 Data Overview - The report presents multiple figures showing data such as the prices of main iron ore varieties at Qingdao Port, the price differences between high - grade, low - grade ores and PB powder, the basis between iron ore spot and the January contract, shipments from Brazil and Australia, arrivals at 45 ports, etc. The data sources are Mysteel and the Research and Development Department of CCB Futures [14][18][22]

1. Report Industry Investment Rating - No information provided on the report industry investment rating 2. Core Viewpoints of the Report - On October 15, the iron ore futures main 2601 contract oscillated downward, closing at 776.5 yuan/ton, down 1.46%. Considering the regular decline after the end of the quarterly volume rush, it is expected that the shipments in October will decline, and the arrival volume will gradually fall back. The daily average pig iron output is still at a relatively high level of over 2.4 million tons but has been slightly declining for 3 consecutive weeks. The growth space of production is limited, and it may oscillate and decline at around 2.4 million tons in the short term. The steel mill's iron ore inventory is expected to gradually fall back after the festival and return to the state of restocking on demand. Overall, the price may oscillate weakly, but it is still expected to fluctuate within the oscillation range since August. The subsequent repair of downstream demand needs to be closely monitored [7][11] 3. Summary by Relevant Catalogs 3.1 Market Review and Future Outlook - **Market Review**: On October 15, the iron ore futures main 2601 contract oscillated downward, opening with an oscillating run and then falling back, and oscillating in the afternoon, closing at 776.5 yuan/ton, down 1.46%. The main iron ore outer - market quotes were flat compared with the previous trading day, and the prices of major - grade iron ore at Qingdao Port dropped by 5 yuan/ton compared with the previous trading day. The daily KDJ indicator of the iron ore 2601 contract showed a dead cross, and the green column of the daily MACD indicator has been expanding for two consecutive trading days [7][9] - **Future Outlook**: BHP will change 30% of the amount in iron ore spot transactions with China to be settled in RMB from the fourth quarter of 2025. It has set an observation period for long - term contracts in 2026 and will start negotiations on long - term contracts denominated in RMB if the market acceptance of the RMB iron ore index reaches the standard. In terms of fundamentals, the shipments and arrivals from Australia and Brazil increased in September. It is expected that the shipments in October will decline, and the arrival volume will gradually fall back. The daily average pig iron output is still high but has been declining slightly for 3 consecutive weeks. The growth space of production is limited. After the festival, the steel mill's iron ore inventory is expected to gradually fall back. Overall, the price may oscillate weakly but is still expected to fluctuate within the range since August [10][11] 3.2 Industry News - China's CPI in September decreased by 0.3% year - on - year, and PPI decreased by 2.3% year - on - year. The decline of PPI narrowed by 0.6 percentage points compared with the previous month. The Chinese Ministry of Foreign Affairs responded to the US threat of imposing 100% tariffs on Chinese goods, urging the US to correct its wrong practices and resolve issues through dialogue and consultation [12] 3.3 Data Overview - The report provides various data charts, including the prices of main iron ore varieties at Qingdao Port, the price differences between high - grade, low - grade ores and PB powder, the basis between iron ore spot and the January contract at Qingdao Port, the shipments from Brazil and Australia, the arrival volume at 45 ports, the utilization rate of domestic mine production capacity, the trading volume at main ports, the available days of steel mill's iron ore inventory, the inventory of imported sintered powder ore, the port iron ore inventory and the port clearance volume, the tax - free pig iron cost of sample steel mills, the blast furnace and electric furnace start - up rates and production capacity utilization rates, the national daily average pig iron output, the apparent consumption of five major steel products, the weekly output of five major steel products, and the steel mill inventory of five major steel products. All data sources are from Mysteel and the Research and Development Department of CCB Futures [14][18][22]

Core Viewpoint - Australia has agreed to settle part of its iron ore transactions in Renminbi, marking a significant shift from its previous stance, driven by China's sudden halt on dollar-denominated imports, leaving Australian vessels with no destination and incurring substantial losses [1] Group 1 - The decision to use Renminbi for iron ore settlements indicates a change in Australia's approach to international trade, particularly with China [1] - China's action to stop dollar-denominated imports has created a crisis for Australian shipping, leading to financial losses [1] - The shift in currency settlement reflects broader geopolitical and economic dynamics affecting trade relationships [1]

曾几何时，中方是美元最大的多头。原因无它，因为对外贸易让中方手里赚了天量的美元，而这些美元 必须花出去。但这绝不是美国趁机收割中方的理由。 没有锣鼓喧天，没有鞭炮齐鸣，必和必拓同意用人民币结算，这项改变全球大宗商品交易格局的协议， 就这样低调地落在了纸面上。表面上看，这只是一份普通的商业协议，但背后却是双方实力的真实较 量。 中方每年进口铁矿石量超过12亿吨，占全球铁矿石进口总量的绝大部分。而必和必拓作为澳大利亚矿业 巨头，其铁矿石业务的60%营收来自中国市场，近八成的出口份额都流向中国。但即便这样，必和必拓 仍强硬的要求必须使用美元。 美元在大宗商品结算的主导地位，出现了结构性松动。这次必和必拓的低头，可能多年后回头看才发现 其里程碑意义。 它的意义远超过许多表面热闹的地缘事件。当第一批以人民币结算的铁矿石从澳大利亚启航，当全球大 宗商品交易员开始习惯查看人民币汇率，美元霸权这座大厦的基石正在被悄然更换。历史性的转变，往 往发生在普通人注意不到的角落。 中国推动铁矿石人民币结算并非一时兴起，而是经过精心布局的战略行动。更具战略意义的是，必和必 拓表面上是澳大利亚公司，但美资控股接近或超过50%。因此这次与必 ...

【现货】 截至10月9日，日均铁水产量241.54万吨/日，环比-0.27万吨/日；高炉开工率84.27%，环比-0.02%；高炉 炼铁产能利用率90.55%，环比-0.10%；钢厂盈利率56.28%，环比-0.43%；进口矿日耗298.80万吨/日， 环比-0.47万吨/日。 【供给】 截至10月13日，主流矿粉现货价格：日照港（600017）PB粉+6.0至796.0元/吨，卡粉+1.0至926.0元/吨。 【期货】 截至10月13日收盘，以收盘价统计，铁矿主力2601合约+9.5（+1.19%），收于804.5元/吨，铁矿远月 2605合约+6.5(+0.84%)，收于781.0，1-5价差走强至23.0，SGX铁矿掉期价格+1.49美元/吨（+1.4%）至 107.85美元/吨。 【基差】 最优交割品为PB粉。卡粉、PB粉、巴混粉和金布巴仓单成本分别为850.6元/吨、844.7元/吨、850.2元/ 吨和854.3元/吨。01合约卡粉、PB粉、巴混和金布巴基差分别是46.1元/吨、40.2元/吨、45.7元/吨和49.8 元/吨。 【需求】 截至10月6日，上周全球发运环比回落，到港量增加。全球发运 ...

Group 1 - The core of the recent U.S.-China tensions revolves around China's strategic responses to U.S. sanctions, particularly focusing on the push for RMB settlement in iron ore and the upgrade of rare earth controls [4][6][8] - China's initiative to promote RMB settlement for iron ore is a significant move against the dollar's dominance in global commodity pricing, potentially reducing the dollar's settlement ratio as more countries adopt RMB for essential commodities [6][8] - The upgrade in rare earth controls is a targeted measure to protect China's industrial interests, particularly in critical sectors like electric vehicles and advanced military equipment, which could severely impact U.S. manufacturing capabilities [8][18] Group 2 - The current market dynamics differ from previous downturns, as China's actions are seen as proactive rather than reactive, suggesting a stronger and more sustainable policy direction [10][12] - Investors in sectors like new energy and rare earths have already seen significant returns, which may lead to increased volatility as profit-taking occurs during market adjustments [13][14] - The challenges facing U.S. manufacturing, including high labor costs and a lack of complete supply chains, highlight the long-term advantages of China's industrial sectors, which are not easily altered by short-term policy changes [15][18] Group 3 - Ordinary investors are advised to maintain a balanced approach, focusing on industry advantages and fundamentals while managing their positions carefully [20][22] - The differences in volatility between Hong Kong and A-shares should be considered, with recommendations to shift some investments to core A-share sectors to mitigate external influences [20][22] - A strong emphasis is placed on understanding the long-term implications of China's industrial strengths and the challenges faced by U.S. manufacturing, rather than being swayed by short-term market fluctuations [23][24][26]

Group 1 - The EU is facing challenges in energy and trade dynamics, with increasing reliance on alternative suppliers and changing payment methods in energy trade [1][9] - In 2023, sanctions aimed at cutting off Russian oil and gas have led to supply shortages and increased operational pressures in factories [3][7] - China has implemented export controls on critical materials like gallium and germanium, impacting the supply chain for industries reliant on these resources [3] Group 2 - The U.S. has raised tariffs on Chinese electric vehicles to 100%, affecting the supply chain and highlighting the difficulty of replacing certain materials in the short term [5] - Despite tariffs, trade routes have adapted, with Southeast Asia becoming a transit hub for materials, and China maintaining a dominant position in battery and critical mineral supplies [5][11] - The shift in energy trade is evident as China has significantly increased its imports of Russian crude oil, accounting for about 40% of Russia's total exports by 2024 [7][11] Group 3 - The payment methods in energy trade are evolving, with the Chinese yuan gaining traction in transactions with Russia, surpassing the dollar in some exchanges [9] - European countries are struggling with energy costs, leading to a resurgence in coal usage and increased subsidies for consumers [9] - The trade relationship between China and Russia has strengthened, with bilateral trade exceeding $240 billion in 2023 and continuing at high levels into 2024 [11] Group 4 - The electric vehicle sector is under scrutiny, with the EU launching anti-subsidy investigations and imposing temporary tariffs, yet orders remain strong due to competitive pricing [13] - Chinese companies are expanding their manufacturing footprint internationally, with factories established in Thailand and Hungary, adapting to tariff challenges [13] - The integration of battery technology and charging networks is becoming a competitive advantage for Chinese firms, as they set standards that are difficult for the U.S. and EU to match [15]