Iron Ore Plunges Below $120 Amid Fresh Pessimism About Demand
Iron ore has given up all its gains made earlier this year, with fresh demand pessimism triggering Monday’s decline of more than 5% amid reports that blast furnaces are idling plants. The lack of a meaningful buy-side recovery, slow end-user demand and a weak housing market have tested iron ore traders’ mettle, with prices slipping to their lowest levels since December. Prices have fallen for eight consecutive trading days. Despite earlier re-opening efforts from lockdowns in China, which eased logistical bottlenecks to allow the transport of the steel-making ingredient and finished products into markets, a lack of demand has prompted blast furnaces to curb output. Weak fundamentals reveal that the government’s recent policy support have so far not succeeded in shoring up sustained enthusiasm in the iron ore market. Blast furnace rates in Tangshan declined for the first time in four weeks, as the country continues to struggle with its re-opening. Downstream demand remains poor with few spot trades occurring, according to a note by Mysteel. China’s bleak construction industry continues to test market confidence, it added.
Iron ore was down 5.8% to $113.05 a ton as of 9:13 a:m. in Singapore. Futures in Dalian sank 7.5% and steel rebar and hot- rolled coil both declined by more than 4%.
Retrieved from:
https://blinks.bloomberg.com/news/stories/RDR31XT0AFB7