Iron ore resumed its dramatic plunge, falling by 7% on daily basis. Market pessimism grew amid steel output reduction and anticipated supply increase in China.
Australian iron ore fines 62% Fe slumped by $10.25/t to $132/t CFR after its futures on the DCE nosedived by $9.8/t from Friday level, to RMB 723/t ($112/t), its lowest since late May 2020. New steel output data and statements from the China Iron and Steel Association (CISA) caused fears about further demand slowdown and supply growth in the raw material market.
In late August, daily crude steel production of CISA members fell by 4% to 2.05 million t compared to the middle of the month. The whole August output dropped by 2.1% to 2.1 million t per day over the month.
Besides, steel production is forecasted to keep decreasing since many provinces have announced stricter operation cuts in the first week of September.