Benchmark iron ore futures extended losses to a third session on Thursday on growing prospects of further improvement in supply of the steelmaking ingredient and signs that steel demand in China has not been as strong as expected.
Iron ore’s January 2021 contract on the Dalian Commodity Exchange fell as much as 3.4 percent to 784.50 yuan ($115.90) a ton, its weakest level since Aug. 3.
Iron ore on the Singapore Exchange slipped 1.6 percent to $117.75 a ton, its lowest level since Aug. 31.
Last week, imported iron ore stocked at Chinese ports hit the highest level since April, SteelHome consultancy data showed, and may rise further as vessel congestion has eased while Brazil and Australia are ramping up shipments.
Against the backdrop of easing concerns about supply tightness, Brazilian iron ore miner Vale SA is looking to expand its annual output capacity to 450 million tons from a current rate of 318 million tons.
Aside from a deterioration in supply fundamentals, steel demand in China has failed to meet expectations, helping spark this week’s sell-offs in ferrous futures and spot markets.