Iron ore price in China fell below 600 yuan ($93.75) per tonne for the first time in nearly a year due to loose supply conditions and poor demand outlook.
Iron ore price in Singapore tumbled for a fifth day as the world’s top steelmaker ramped up efforts to cap annual volumes.
Shipments from major miners in Australia and Brazil have been stable at relatively high levels.
Iron ore exports from the two countries increased by nearly one million tonnes to 23.96 million tonnes as of Nov.1, data from Mysteel consultancy showed.
Daily crude steel output in the final third of October dropped to the lowest since March 2020, according to Mysteel, which cited a survey of 247 blast furnaces and 71 electric-arc furnaces.
The demand side of raw materials, however, remained cool on steel production controls and sluggish downstream consumption.
“Affected by heating season and winter Olympics (controls), molten iron output is hard to increase and could stay weak in short-to-medium term,” SinoSteel Futures wrote in a note.
Zhuo Guiqiu, analyst with Jinrui Capital, also noted daily molten iron production is at much lower level compared with same period in past two years.
“Steel products consumption also failed market expectation due to slack property market and infrastructure constructions,” Zhuo added.
“The probability that iron ore demand slides by at least 20% in the fourth quarter is increasing, judging from lower downstream demand,” said Orient Futures Co. analyst Xu Huimin.
“We have to monitor if mills will actually reduce production on their own, which will worsen the market a step further.”
($1 = 6.4002 Chinese yuan)
(With files from Reuters and Bloomberg)