Iron ore futures in China closed at a two and a half month low on Monday, falling in the fourth session as demand eased amid a slowdown in the manufacturing sector and shrinking inventories at factories.
The best-selling iron ore futures on the Dalian Commodity Exchange for January 2020 delivery fell 2.4% to 592 yuan ($ 84.64) a tonne, the lowest since Aug. 29. They were down 3.1% earlier in the session.
China recorded the largest producer price decline in October in three years, which was offset by weaker demand in the manufacturing sector and continued Sino-US trade tensions.
Construction steel rebar on the Shanghai Futures Exchange fell 1.1% to 3,373 yuan a tonne.
Hot rolled steel used in automobiles and home appliances for January delivery fell 1.0% at 3,321 yuan.
“The ferrous metals market is at its weakest as steel mills are cutting inventories for year-end financial statements,” said Darren Toh, a steel and iron data scientist at Singapore-based Tivlon Technologies.
Steel inventories in China stood at 8.9 million tonnes as of Nov. 7, the lowest level since Jan. 11, according to data compiled by consulting firm MySteel.
Markets are also influenced by the news that China's Jingye Group said it was still in talks to buy British Steel after the BBC announced the company was going to buy the British steelmaker for $ 90 million.
In China, iron ore and steel futures fell amid weak demand
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