The iron ore price fell for a seventh consecutive session overnight, extending its decline to the lowest level seen since mid-July.
According to Metal Bulletin, the spot price for benchmark 62% fines fell a further 59 cents, or 1.14% to $51.03 a tonne. The price has now fallen 10% since October 12, extending its losses for calendar year 2015 to 25.9%.
Lower grade ore was hit even harder than the benchmark, with the spot price for 58% fines tumbling 66 cents, or 1.48%, to $44.04 a tonne.
The losses came despite further evidence that low-cost seaborne supply was helping to push out high-cost Chinese iron ore production over the past year.
“While production data last week showed iron ore output from the Big 3 seaborne players still increasing, it is a different picture in China where volume continues to be displaced,” wrote analysts at Metal Bulletin.
“China’s domestic iron ore production continued to shrink in September, with volumes down 4.4% year-on-year amid a weakening market. The country’s run-of-mine (ROM) output totalled 131.6 million tonnes last month, according to data published by the National Bureau of Statistics (NBS) today.
“Although output was up 6.3% on the month, volumes for the first three quarters were still 9% lower than year-earlier levels, at just over 1 billion tonnes.”
Mirroring the weakness seen in spot price, Chinese iron ore futures fell modestly overnight. According to pricing provided by the Dalian Commodities Exchange, the most actively traded January 2016 contract slid 0.54% to 365.5 yuan.
Trade in Dalian’s day session will resume at 12pm AEDT.