Iron ore prices plunged toward $100 per ton on Monday, as China’s latest economic stimulus measures failed to meet investor expectations, exacerbating concerns over excess supply. The decline follows a 2% drop in Singapore futures after Friday’s announcement of a debt-swap plan by the Chinese government, which disappointed markets by not including more direct actions to stimulate domestic demand, particularly in the struggling property sector.
The steelmaking commodity has fallen by over 25% this year, largely due to the ongoing downturn in China’s property market and an increase in mining output. Despite weak domestic demand, Chinese steel mills have ramped up exports, which hit their highest levels since 2015 in the previous month.
Meanwhile, stockpiles of iron ore at Chinese ports have been steadily rising for the past month, reaching their highest point since early September. On a seasonal basis, the inventory levels are the largest ever recorded for this time of year.
By 10:47 a.m. in Singapore, iron ore futures had fallen 1.7% to $100.85 per ton, after a 2.8% loss on Friday. In Dalian, yuan-denominated contracts dropped 2.3%, while steel futures in Shanghai also saw declines.
Shares of major iron ore mining companies in Australia, including BHP Group, Fortescue Metals, and Rio Tinto, also saw losses amid the ongoing price downturn.
In the base metals sector, copper prices gained 0.2%, rising to $9,458.50 per ton on the London Metal Exchange, although it still marked the sixth consecutive weekly decline. Aluminum also increased by 0.2%, while nickel prices fell 0.9%.
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