Iron ore futures prices fell on Monday, as a batch of downbeat data in top consumer China sparked concerns over demand prospects for the key steelmaking ingredient.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) closed daytime trade 0.58% lower at 767 yuan ($107.68) a metric ton. It touched the lowest since September 1 at 762.50 yuan earlier in the session.
“The downstream steel consumption was weaker than expected in the traditionally peak demand month in September … we expect crude steel output to stay relatively low amid growing uncertainties,” Ge Xin, analyst at consultancy Lange Steel, said in a note.
The benchmark November iron ore on the Singapore Exchange gave up earlier gains from a softer U.S. currency, which makes dollar-priced commodities cheaper for buyers using other currencies.
The Singapore benchmark traded 0.45% lower at $103.45 a ton, as of 0739 GMT, and hit its lowest since October 9 at $103.25 earlier.
China’s economic growth likely slowed to a one-year low in the third quarter as a prolonged property downturn and trade tensions weighed.
Some key indicators, including property investment and new construction starts, among others, pointed to gloomy steel demand, dragging ore prices.
Also, new home prices in China fell at the fastest pace in 11 months in September, worsening the sector’s drag on broader economic growth.
Sluggish home demand saw China’s crude steel output in September slide to a 21-month low.
Coking coal and coke, other steelmaking ingredients, added 2.66% and 1.63%, respectively, as safety checks at some key production areas led to expectations of constrained supply, according to analysts.
Steel benchmarks on Shanghai Futures Exchange largely moved in a tight range.
Rebar nudged down 0.03%, hot-rolled coil shed 0.12%, stainless steel lost 0.16% and wire rod (SWRcv1) slipped 0.53%.
Source: Reuters