Iron ore plummets as China steps up price misinformation warning

The most-traded iron ore for May delivery on China’s Dalian Commodity Exchange tumbled by the 10% daily trading limit to 699 yuan ($110.08) a tonne, its weakest since Jan. 18.

The steelmaking ingredient’s front-month March contract on the Singapore Exchange slumped by as much as 13.8% to $127.90 a tonne.

“Iron ore futures remained under pressure amid China’s determination to limit speculative price gains,” ANZ commodity strategists said in a note.

The continued sell-offs reflected growing investor jitters as China’s state planner, together with the market regulator, will summon domestic and foreign iron ore traders for a Feb. 17 meeting, in an effort to ensure market stability, according to two sources and a notice reviewed by Reuters.

China’s National Development and Reform Commission has doubled down on a warning issued last week against unspecified information providers that it claimed were fabricating iron ore prices.

In what appeared to be a concerted effort to cool a sustained rally - Dalian iron ore hit its highest in more than five months last week - the Dalian exchange has announced an increase in the transaction fee for futures contracts for February to May deliveries.