The iron ore price slipped on Monday, making it three successive declines on the trot.
According to Metal Bulletin, the spot price for benchmark 62% fines fell by 0.37%, or 20 cents, to $54.34 a tonne, leaving the price at the lowest level seen since April 8.
From April 21 when the spot price hit a multi-year high of $70.46 a tonne, the price has now fallen by 22.9%.
Metal Bulletin notes that the price decline corresponded with news that Chinese crude steel output hit a record-high in April.
“According to National Bureau of Statistics, China country produced 69.42 million tonnes of crude steel last month, up 0.5% year-on-year,” said analysts at the group in its Monday report.
“China’s daily crude steel output hit a record high in April following an improvement in mills’ profitability since March. This averages out to a rate of 2.314 million tonnes per day, up 1.5% month-on-month and an all-time high.”
Although the price continues to slide, it appears that authorities have successfully stymied rampant speculative forces that were evident in recent months with the price moving by less than 1% in each of the past five sessions.
That’s a significant turnaround from the prior 15 sessions where the price moved in excess of 2%, often more, as whirlwind trading activity in Chinese iron ore futures led to some crazy movements in physical markets.
Fitting with the idea that speculative activity is now well below recent peaks, Chinese iron ore futures on the Dalian Commodities Exchange eked higher overnight, rising just 0.14%.
There were also similarly small declines registered in Chinese rebar and coking coal futures.
Trade in all three contracts will resume at 11am AEST.