SINGAPORE- Iron ore futures extended declines to a second straight session on Monday, weighed down by slower production of hot metal in China, although stronger economic data from the top consumer limited the fall.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) ended morning trade 1.37 percent lower at 758.0 yuan ($103.43) a metric ton.
The benchmark February iron ore on the Singapore Exchange eased 1.19 percent to $97.65 a ton.
“With the Chinese New Year holiday beginning in just four weeks’ time, the pre-holiday stockpiling of iron ore will lend some support to prices of the feedstock this month,” Chinese consultancy Mysteel said.
“But ore prices will face downward pressure as the seasonal decline in hot metal output at mills will see slow ore replenishment.”
Output at Chinese blast-furnace steel producers has continued to decline steadily, driven by increasing maintenance stoppages as Chinese New Year is approaching, Mysteel added.
Meanwhile, global iron ore supply has recently been at a high level, driven by shipments from Australian mines, Chinese consultancy Hexun Futures said.
