Iron ore fell below $ 100 a ton on Friday for the first time since July 2020 as China's measures to clean up its highly polluting industrial sector sparked a precipitous and violent collapse.
The Ministry of Ecology and the Environment said on Thursday in draft guidelines that the campaign on winter air pollution plans to involve 64 regions in key monitoring.
The regulator said steel mills in these regions will be forced to cut production based on their emission levels during the October to late March campaign.
“Strict production controls have recently led to lower market prices and the pessimistic outlook for demand has intensified,” write analysts at SinoSteel Futures.
Prices have more than halved since their peak in May, as the world's largest steelmaker tightens production restrictions to meet its target of lower volumes this year, and a sharp downturn in China's real estate sector is affecting demand.
The downturn in iron ore makes it one of the worst performing major commodities and a marked departure from the broader boom as aluminum soared to a 13-year high, gas and coal futures prices soared to unprecedented levels.
Meanwhile, steel prices are still high. According to Citigroup Inc., the market remains undersupply as production in China is well ahead of falling demand.
Iron ore prices plummet and coal and gas futures soar to unprecedented levels
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