Iron ore has fallen with futures pointing to even larger declines to come

Ezra Shaw/Getty Images

Iron ore prices fell modestly on Tuesday, and, if Chinese futures are anything to go by, there could be even larger declines to come.

The spot price for benchmark 62% fines fell by 0.52% to $55.93 a tonne, according to Metal Bulletin, trimming its year to date gain to 28.4%.

By various accounts the decline coincided with a sharp drop in market activity.

Looking ahead to Wednesday, it appears likely that the spot price will continue to slide, at least based off the bearish price action in Chinese futures overnight.

The most actively traded September 2016 iron ore contract on the Dalian Comodities Exchange slumped 2.87%, finishing the session at 423.5 yuan.

Trade in Dalian will resume at 11am AEST.

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