Iron ore in full-scale retreat

China's iron ore futures fell 8 percent on Thursday, their biggest one-day fall in more than five months, amid fears that demand for raw materials is threatened by slower steel consumption.

At the Shanghai Stock Exchange, rebar fell more than 6 percent, as did coking coal, another steelmaking raw material. China's crude steel production hit a record 72 million tonnes in March and there are indications that output will remain high for the first 20 days of April, said Wang Di, an analyst at CRU in Beijing.

Since steel prices fell last month, some Chinese mills have started to implement their maintenance plans to somehow manage output, he said.

Iron ore on the Dalian Mercantile Exchange fell 8 percent to a bottom of 485 yuan a tonne, the largest daily drop since Nov.16. The increase in shipments in recent months has helped boost inventories at Chinese ports. After peaking at a record 132.5 million tons in March.

The fall in iron ore came after base metals took their biggest daily step back this year amid concerns over the outlook for demand in China and a stronger dollar. Copper fell back on Wednesday after stocks rallied, while nickels plunged as supply problems in the Philippines declined.