Iron ore spot markets continued to weaken on Monday, seeing the benchmark price slip below $90 a tonne for the first time in a month.
According to Metal Bulletin, the price for 62% fines slid 1.74% to $89.73 a tonne, leaving it at the lowest level since February 10.
It has now fallen 5.4% since hitting a multi-year high of $94.86 a tonne on February 21, trimming its advance this year to 13.8%.
Higher grade ores underperformed lower grades during the session.
Metal Bulletin said that the weakness coincided with continued weakness in Chinese rebar prices.
“China’s spot rebar prices were mixed on Monday amid a sharp decrease in the futures market,” the group said.
“In Shanghai, prices widened downwards as smaller mills made cuts in an attempt to secure more bookings, whereas larger mills kept their prices unchanged.”
It also said that several market participants said that they expected recent declines in futures market to push down spot rebar prices further.
Seemingly, news that China will continue to reduce annual steel capacity levels this year was not enough to stir any enthusiasm among traders.
It also weighed on the share price of Australia’s largest producers overnight with BHP Billiton and Rio Tinto losing 1.87% and 2.08% respectively in London trade.
After sliding on Monday, dragging spot rebar and iron ore prices lower as a consequence, Chinese commodity futures stabilised in overnight trade.
The May 2017 iron ore future last traded at 665.5 yuan, up from the final price of Monday’s day session of 661 yuan. The May 2017 rebar future also stabilised, finishing overnight trade at 3,482 yuan having closed the day session at 3,467 yuan.
SHFE Copper ¥47,860 , -1.03%
SHFE Aluminium ¥13,900 , -0.93%
SHFE Zinc ¥22,395 , -1.08%
SHFE Nickel ¥91,580 , 0.55%
SHFE Rebar ¥3,482 , -0.83%
DCE Iron Ore ¥665.50 , -1.63%
DCE Coking Coal ¥1,323.00 , 0.61%
DCE Coke ¥1,808.00 , 0.17%
Trade in Chinese commodity futures will resume at midday AEDT.