Iron ore hit a three-month low as the upcoming Lunar New Year and ongoing property market crisis cast a shadow over Chinese demand.
Benchmark futures in Singapore dropped for the fifth time in six sessions, sinking below $124 a ton overnight to hit the lowest intraday level since early November. Hot-metal production in China is muted, with pre-holiday steel demand generally weak, according to Huatai Futures Co.
The nation’s property market — the largest driver of steel demand — continues to face liquidity woes. More than 1,000 projects in 25 cities are seeking 373 billion yuan ($52 billion) in funding, according to a tally by Bloomberg Intelligence, which said it showed “the grave need for finance.”
Iron ore has suffered from a poor start to the new year, retreating by about 11% in one of the weakest performances among major commodities. The steel-making staple has been dragged lower by China’s as-yet-unfixed property woes, as well as signs of abundant supplies from Brazil.
