Fitting with the price action seen in Chinese futures – limit down 4% for most of the trading session – the spot iron ore price was hammered overnight.
According to Metal Bulletin the price for benchmark 62% grade ore fell 5.03%, or $2.82, to $53.28 a tonne.
It was the largest decline in percentage terms since July 8 and left the price at levels last seen on July 27. From a historical perspective, it was the 15th-largest decline since Metal Bulletin began releasing spot pricing in mid 2009.
Year-to-date it has fallen $17.98, or 25.23%.
Indicating that further steep declines are likely to follow this evening, Dalian iron ore futures were hit hard yet again overnight.
The most actively traded January 2016 contract fell 6.5 yuan, or 1.77%, to 361 yuan.
If sustained today it points to the likelihood of a further steep decline in the spot price this evening.