Iron ore spot markets remain under pressure, falling for a third consecutive session on Tuesday.
According to Metal Bulletin, the price for benchmark 62% fines fell by a further 1.1% to $75.71 a tonne, extending its slide over the prior three sessions to 4.3%.
It now sits at the lowest level since January 3.
As is so often the case, the weakness in the benchmark was mirrored across the grades.
The price of 58% fell 0.1% to $41.76 while ore with 65% Fe content skidded 1.1% to $91 a tonne.
Analysts put the weakness down to renewed concerns about demand following news that Chinese iron ore port inventories swelled to the highest level on record last week.
“A combination of a harsh winter in China and plentiful inventories at the ports is reducing traders’ appetite in the spot physical market,” said Daniel Hynes, commodities analyst at ANZ Bank.
News that Rio Tinto — the world’s second largest iron ore producer — shipped a record 90 million tonnes of iron ore in the December quarter may have also contributed to the weakness seen on Tuesday.
Rio added that it could ship up to an additional 10 million tonnes of iron ore this year.
Coinciding with that news flow, iron ore futures in Dalian fell heavily once again, closing down 1.6% at 529.5 yuan a tonne, likely contributing to the weakness seen in spot markets on Tuesday.
Other steel making ingredients such as coking coal and coke also tumbled, falling 4% and 1.5% respectively to 1,277.5 yuan and 1,959.5 yuan a tonne.
In contrast, rebar futures edged higher, lifting 0.2% to 3,790 yuan a tonne in Shanghai.
As seen in the scoreboard below, there was very little movement in those contracts aside from rebar during Tuesday’s night session.
SHFE Rebar ¥3,837 , 0.60%
DCE Iron Ore ¥531.50 , -0.84%
DCE Coking Coal ¥1,274.00 , -2.60%
DCE Coke ¥1,960.50 , -0.81%
While not convincing by any stretch, the modest lift in rebar and iron ore futures points to the likelihood that selling pressure in iron ore spot markets may ease today.
Trade will resume at midday AEDT.