Iron ore spot markets continued to slide, falling to fresh three-month lows on Thursday.
According to Metal Bulletin, the price for benchmark 62% fines fell by a further 2% to $62.89 a tonne, leaving it at the lowest level since July 7.
Both higher and lower grade ores lost ground during the session.
58% fines shed 1.2% to $38.81 a tonne while ore with 65% Fe content fell by a larger 2.3% to $86.80 a tonne.
The weakness in spot markets followed another steep plunge in Chinese iron ore and coal futures on Wednesday, fuelled by a combination of technical selling and ongoing concerns about the outlook for demand given upcoming curbs on Chinese steel production.
“Impending steel output cuts in China are weighing on the iron ore demand outlook,” said Vivek Dhar, mining and energy commodities analyst at the Commonwealth Bank. “Market participants also note that iron ore restocking demand will likely wane as steel production comes under pressure.”
Iron ore futures in Dalian slumped 3.5% to to 451 yuan, its largest one-day percentage loss since May 24.
Coke and coking coal futures were also hammered, tumbling 6.1% and 3.8% respectively to close at 1,875 yuan and 1,124 yuan.
Rebar futures in Shanghai fell by a smaller 1% to finish at 3,606 yuan.
Suggesting that it may be a quiet session before China breaks for week-long holiday, futures inched higher in overnight trade, hinting that the shellacking seen on Thursday may not be repeated today.
Here’s the final scoreboard for Thursday’s night session.
SHFE Rebar ¥3,612 , -0.80%
DCE Iron Ore ¥454.50 , -0.98%
DCE Coking Coal ¥1,134.50 , -0.83%
DCE Coke ¥1,898.00 , -1.22%
Trade in Chinese futures will resume at 11am AEST.