SINGAPORE: Iron ore futures extended declines to hit their lowest in more than a month on Monday, as hot metal output in China slowed while weakness in the top consumer’s equity markets added pressure on prices.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 2.21% lower at 751.5 yuan ($102.54) a metric ton, closing at its weakest level since Nov. 19.
The benchmark February iron ore on the Singapore Exchange eased 1.74% to $96.5 a ton, as of 0733 GMT.
“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.
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