Iron Ore Price Outlook: Navigating Supply Pressures in 2026

After rebounding from its September 2024 lows, iron ore price momentum has faced considerable headwinds entering 2026. As we move into February 2026, the market confronts a critical juncture: demand softness in China collides with surging supply from new mining projects, particularly Guinea’s transformative Simandou operation. Understanding these dynamics is essential for grasping where iron ore price trajectories may lead.

How Iron Ore Price Movements Unfolded in 2025

The past year painted a volatile picture for iron ore markets. Prices opened 2025 in the high $90s range, climbing to $107.26 by mid-February before succumbing to significant pressure through the spring months. A broader base metals selloff in April dragged iron ore price to $99.05, and weakness persisted into summer as prices hit a yearly trough of $93.41 in early July—the lowest point of the year.

The second half told a different story. Iron ore price recovered ground during Q3, surpassing the $100 per metric ton (MT) threshold in August and reaching $106.08 by early September. Q4 saw relative stability, with prices generally holding above $104 MT until December’s final push, when iron ore price touched its 2025 apex of $107.88 before settling near $106.

What Drove Iron Ore Price Pressures in 2025?

Two major forces dominated the iron ore price narrative last year: China’s real estate crisis and global trade uncertainties.

China’s Property Sector Collapse: Since 2021, when major developers like Country Garden and Evergrande filed for bankruptcy, China’s construction industry has remained depressed. This matters enormously because construction drives roughly 50 percent of steel consumption globally, making it the single most important demand driver for iron ore price. Despite various government stimulus attempts, the Chinese property market never recovered, creating persistent headwinds that suppressed iron ore price throughout 2025’s first half.

Tariff Threats and Trade Anxiety: The April introduction of US tariffs under the Trump administration sparked immediate market turmoil, creating fears of global recession and sending commodities—including iron ore—into sharp decline. Though markets recovered after tariff rhetoric was dialed back, the uncertainty created lasting psychological pressure on iron ore price throughout the year.

Simandou Mine Launch: In December, Guinea’s Simandou mine—jointly owned by Rio Tinto, China Hongqiao Group, and government entities—began shipping its first cargo of high-grade ore (65 percent iron content) to Chinese smelters. This represented a watershed moment for global iron ore supply.

The 2026 Iron Ore Price Challenge: Supply Surge Meets Weakening Demand

Entering 2026, the iron ore price equation has fundamentally shifted. While Chinese economic growth is projected at 4.8 percent, the property sector will likely continue its decline. More critically, steel production dynamics are changing. According to analysis from Project Blue, electric arc furnaces—which use scrap steel rather than raw iron ore—are gaining market share. Currently representing 12 percent of China’s steel output, this technology is expected to reach 18 percent by the early 2030s as producers pursue emissions caps and respond to Europe’s new Carbon Border Adjustment Mechanism (CBAM).

The irony is stark: countries expanding steel production (India, Russia, Brazil, and Iran) are self-sufficient in iron ore and don’t import. Meanwhile, the European Union and China are increasingly pivoting toward lower-carbon production methods that reduce iron ore demand.

This demand erosion arrives precisely when global supply is accelerating. All major iron ore miners plan significant production increases in 2026, with Simandou leading the charge. Over the next 30 months, the mine will ramp production toward 40-50 million metric tons annually by 2027—a scale that could fundamentally alter supply chains and strengthen China’s negotiating position with Australian suppliers.

Iron Ore Price Forecasts: Expert Predictions for 2026

Consensus has emerged around modest iron ore price levels for 2026. Project Blue’s Erik Sardain expects iron ore price to remain under pressure, anticipating a range of $100-105 per MT in H1 2026 due to seasonal demand strength, followed by a slip below $100 per MT in H2 as Simandou ramps accelerate.

This aligns with forecasts from other major institutions:

• BMI projects an average of $95 per MT
• RBC Capital Markets estimates $98 per MT
• Consensus forecast: $94 per MT

These predictions reflect the underlying reality: soft demand growth is increasingly outmatched by expanding mine capacity, leaving iron ore price vulnerable to downward pressure unless demand drivers prove stronger than currently anticipated. The Simandou mine ramp-up will be the critical factor determining whether iron ore price remains above psychological support levels or eventually breaks through to lower ranges.

As 2026 unfolds, iron ore market participants will closely monitor Chinese economic data, trade policy developments, and Simandou’s operational progress—three variables that will ultimately determine whether iron ore price trajectories align with optimistic seasonal patterns or pessimistic supply-driven realities.