Iron ore hits one-week low on nagging China demand concerns

Aug 4 (Reuters) - Dalian and Singapore iron ore futures slumped to one-week lows on Thursday, pressured by worries about an unsustainable demand recovery in top steel producer China and prospects of increased supply.

On China's Dalian Commodity Exchange, the steelmaking ingredient's most-traded iron ore, for delivery in January next year DCIOF3, DCIOcv1, dropped 4.1% to 696.50 yuan ($103.14) a tonne, its weakest since July 28.

Iron ore's front-month September contract on the Singapore Exchange SZZFU2 fell by up to 2.4% to $107.30 a tonne, down for a fifth session.

China's troubled property sector, COVID-19 curbs, decarbonisation goals that entail steel production cuts, and increased Sino-U.S. tensions over Taiwan all weighed on sentiment, analysts said.

Construction steel rebar SRBcv1 and hot-rolled coil SHHCcv1 on the Shanghai Futures Exchange SRBcv1 both fell 1.7%. Stainless steel SHSScv1 rose 0.5%.

"Iron ore lacks continuous upward momentum," analysts at Zhongzhou Futures said in a note, despite rebounding steel margins in China that had fuelled a recent rally.