Iron ore futures collapsed by 8% overnight, pointing to a fresh record low

The spot price for iron ore has suffered back-to-back five percent losses to start the week. Since June 24, the price has fallen by an alarming 20.7%. Over this year that extends to 30.4%.

Well, we may have seen nothing yet.

Overnight the September 2015 Dalian commodity exchange iron ore contract, a reliable a lead indicator for spot price movements, collapse by 7.92%, taking the contract to the lowest level seen since it was established in October 2013.

Given the sheer scale of the decline witnessed in futures markets overnight, it looks like the spot price will test the $47.08 record-low level struck in early April should the losses be sustained today.

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