Iron ore futures fell on Monday, with the Dalian benchmark hitting a four-week low after the Chinese Golden Week holiday, as negative steel mill margins, steel production curbs, and uncertain economic recovery weighed on demand and sentiment.
The most-traded January iron ore on China’s Dalian Commodity Exchange dropped as much as 2.9 percent to hit 827 yuan ($113.35) per metric ton, its weakest since Sept. 11.
On the Singapore Exchange, the steelmaking ingredient’s benchmark November contract was down 2.3 percent at $112.25 per ton.
Following robust third-quarter gains driven by China’s stimulus measures for its flagging economy and struggling property sector, iron ore prices may soften in the near term as market fundamentals weaken and China’s recovery remains uncertain, analysts said.
“This month may see iron ore market fundamentals in China… begin to deteriorate,” consultancy Mysteel said in its monthly outlook, citing rising supply and softening demand in the country that accounts for more than half of the world’s steel output. – Reuters
