Iron ore hit the lowest level since last May to trade well below $100 a ton ahead of data from China that may point to further weakness across its vast steel industry.
Futures declined as much as 3% to $97 a ton in Singapore after collapsing by more than 13% last week. Industrial production data are due later on Monday, offering an insight into conditions across Asia’s largest economy.
Iron ore has retreated by more than a quarter since the start of the year to be one of the weakest performers among major commodities. The slump has been driven principally by concerns about demand in China, where officials are battling a prolonged crisis in the nation’s steel-intensive property sector. Against that backdrop, some mills have been reducing production.
“Signs of weakness in demand continue to emerge, with Chinese smelters announcing output cuts,” ANZ Group Holdings Ltd. said in a note by analysts including Daniel Hynes.
Holdings of iron ore at ports in China — the world’s biggest importer — have been building up, pointing to ample supplies. Inventories swelled to 140.9 million tons last week, the highest level in more than a year.
Iron ore for April traded 0.3% lower at $99.65 a ton at 8:13 AM in Singapore.
