Dalian and Singapore iron ore futures fell on Tuesday, stretching losses as an expected seasonal pickup in China steel demand has been slow and weak so far, and with traders extra cautious about regulatory risks.
The most-traded September iron ore on China’s Dalian Commodity Exchange shed as much as 1.7 percent to 773.50 yuan ($112.33) a ton, its weakest since March 27.
On the Singapore Exchange, the steelmaking ingredient’s benchmark May contract dropped 1.2 percent to $116.05 a ton, on track for a seventh straight session of decline. It slumped to a three-month low of $115.20 on Monday.
“The peak season for steel demand is not strong,” Huatai Futures analysts said in a note.
With weak steel demand for infrastructure projects in China and sluggish activity in the domestic real estate sector, they said “the market pessimism has increased”.
Also weighing on sentiment, top steel producer China’s state planner, the National Development and Reform Commission (NDRC), last week said authorities would step up supervision of iron ore markets, asking traders to not deliberately exaggerate price increases.
Fears of regulatory intervention to curb prices have dragged down iron ore futures below $120 a ton since last week. – Reuters
