Iron ore price sinks amid growing pessimism over demand outlook in China

The iron ore price plunged more than 8% on Monday as steel mills idled blast furnaces amid growing pessimism over the demand outlook in China.

Benchmark 62% Fe fines imported into Northern China fell 8.18%, to $111.69 per tonne, the lowest since December 17.

The most-traded iron ore contract, for September delivery on China’s Dalian Commodity Exchange ended daytime trade 11% lower at 746 yuan ($111.60) a tonne, its lowest since March 16.

Mining stocks also slid, with Vale down almost 8% from the previous week, Rio Tinto down 7% and Fortescue down 16%.

“Heavily subdued, covid-afflicted domestic steel consumption” continued to weigh on China’s ferrous complex, said Atilla Widnell, managing director at Navigate Commodities in Singapore.