Iron ore prices tumbled on Friday, falling for the first time in five trading sessions.
According to Metal Bulletin, the spot price for benchmark 62% fines slumped by 2.2% to $59.37 a tonne, trimming its weekly gain to 6.26%.
Year to date it has now rallied 36.3%.
The decline came despite further disruptions in Chinese steel production, something that some analysts have cited as a potential catalyst for the recent surge seen in both steel and iron ore prices.
“Inspection teams from the Ministry of Environmental Protection continue to check on emissions in east China’s Jiangsu province, where steel production is second only to Hebei province in the country,” said analysts at Metal Bulletin.
“Currently, the northern Jiangsu cities of Yancheng, Suqian, Lianyungang and Xuzhou are affected, according to a local media report.
“The inspections in the provinces of Jiangsu, Henan and Inner Mongolia have reduced the output of construction steel by over 46,000 tpd [tonnes per day] and that of billet by 10,000 tpd, and these numbers may rise further, according to the report,” it added.
Providing no indication as to what direction iron ore markets will likely head on Monday, Dalian futures were largely flat on Friday evening, closing the session at 470 yuan, an increase of 0.43%.
Trade in Dalian will resume at 11am AEST, right when the Chinese government will release manufacturing and steel industry purchasing managers’ indices (PMIs) for July.
These releases, particularly the latter, are often influential on movements in Chinese bulk commodity futures.