Iron ore prices fell during Monday’s trading, as investors’ hopes for a recovery in Chinese steel demand after the end of the Lunar New Year holiday faded.

Iron ore futures prices traded in Singapore fell by 3.5% to $115.90 per ton after touching their lowest level since October 27 earlier in the session, with the prices of contracts traded on the Chinese Dalian Stock Exchange falling by 2%.

The decline in iron ore prices has raised investor concerns, especially as the months of March and April approach, when demand for iron in China is active for construction purposes. Meanwhile, the Brazilian Vale SA, which is the second largest iron ore producer in the world, announced: Its quest to increase production outside China is an indication that mining companies are not optimistic about a recovery in demand, according to what Bloomberg reported.

Minmetals Futures said in a note that steel production remains low and has not fully recovered after the Lunar New Year holiday, and that companies are likely to limit their production based on sales volume due to low profitability.

Data from the China Iron and Steel Association revealed that steel factory inventories in Beijing rose by 25.7% in mid-February compared to the beginning of the same month, with a slight increase in the daily production rate recently.