Iron ore futures prices declined for a third straight session on Thursday, with the Singapore benchmark falling below the key psychological level of $100 a metric ton, weighed down by resumed talks of steel output curbs in top consumer China.
The benchmark September iron ore on the Singapore Exchange slid 2.03% to $99 a ton, as of 0732 GMT, hitting its lowest since July 31.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 3.63% lower at 729.5 yuan a ton, touching the lowest since April 1.
The contract hit an intraday low of 727 yuan, the weakest since Aug. 15, 2023.
Market talks that China’s top steelmaking hub Tangshan will impose stringent restrictions on steel output soured sentiment, pressuring ore prices, said analysts.
The Development and Reform Commission and the Bureau of the Industry and Information Technology in Tangshan did not respond to Reuters’ requests for comment.
Beijing has made it clear that it would continue managing crude steel output this year but has yet to disclose any essential details regarding timing and scale.
“The signs of weakness in the steel market including subdued domestic demand, slowing exports and widening losses among steelmakers dented appetite for raw materials, weighing down on their prices,” said Zhuo Guiqiu, an analyst at Jinrui Futures.
“Demand in the coming month – the typically peak consumption season – will improve, but we suggest not to hold very high expectations.”
The market was also weighed down by growing supply as reflected in higher iron ore imports in July, high portside stocks and a surge in July iron ore exports from key supplier Brazil.
Other steelmaking ingredients on the DCE retreated, with coking coal DJMcv1 and coke DCJcv1 down 1.75% and 1.82%, respectively.
Steel benchmarks on the Shanghai Futures Exchange posted further losses. Rebar SRBcv1 shed 1.78% to hit the lowest since April 2020, hot-rolled coil SHHCcv1 lost 2.04%, wire rod SWRcv1 fell 3.17% and stainless steel SHSScv1 dropped 0.76%.
Source: Reuters