Iron ore makes it a hat-trick of losses

Nathan Stirk/Getty Images
  • Iron ore spot markets fell again on Thursday, coinciding with a reversal in Chinese steel futures.
  • The price for benchmark 62% fines has fallen 5.3% over the past three sessions, leaving it at three-week lows.
  • Chinese rebar and iron ore futures finished mixed in overnight trade.

Iron ore spot markets fell again on Thursday, coinciding with a reversal in Chinese steel futures.

The spot price for benchmark 62% fines slumped 0.9% to $64.88 a tonne, according to Metal Bulletin, extending its losses over the past three sessions to 5.3%.

It now sits at a three-week low.

As was the case on Wednesday, the declines across other grades were far smaller in scale.

58% fines was near-flat, losing three cents to settle at $38.58 a tonne. 65% fines also fared better than the benchmark, sliding 0.7% to close at $87.70 a tonne.

The across-the-board weakness coincided with a reversal in Chinese rebar futures which gave up earlier gains before slumping into the close.

“Trade tension continued to weigh on the sector,” ANZ analysts said in a note.

“Steel futures in China closed lower as the US progressed toward the implementation of tariffs on steel. While it announced several US companies were exempt from the tariffs on certain products, it remained strong on its stance against China’s impact on steel markets.”

ANZ said the weakness in steel markets also weighed on iron ore prices during the session.

The October 2018 contract finished Thursday’s day session at 3,773 yuan, below Wednesday’s night session close of 3,807 yuan. It traded above that level earlier in the day.

Mirroring the price action in steel markets, Dalian iron ore futures also gave up earlier gains, finishing trade at 453 yuan, off the high of 460.5 yuan struck earlier in the session.

As seen in the scoreboard below, there was very little movement on those levels in overnight trade.

SHFE Rebar ¥3,768 , -1.05%
DCE Iron Ore ¥455.50 , 0.00%
DCE Coking Coal ¥1,179.50 , -2.36%
DCE Coke ¥2,129.00 , -0.58%

The mixed performance provides few clues as to whether the losses in spot iron ore markets will extend into a fourth consecutive session today.

Trade in Chinese commodity futures will resume at 11am AEST.

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