Iron ore futures fell below the level of $100 per ton for the first time in 7 months, as investors expect that the years-long real estate crisis in China will continue throughout 2024, which may hinder the rise in demand for steel.
The price of the metal used in the steel industry has declined by more than 30% since the beginning of January, with hopes of a tangible recovery in building and construction activity fading. Loss-making steel mills reduce their purchases of crude, whose stocks are accumulating in Chinese ports.
The price decline worsened this week in light of increasing signs of weak demand. Steel mills in China began announcing production cuts as spot steel prices declined.
This poor performance contrasts with the price rally of 2023, when the price of iron ore outperformed other base metals and commodities and rose by 20%.
