Iron ore price at 2-week low on possible steel output curbs

Iron ore prices fell on Monday on worries of a possible steel output curbs during winter in China, and as pre-holiday restocking came to an end.

The most-traded January iron ore contract on China’s Dalian Commodity Exchange ended daytime trading 2.03% lower at 844.5 yuan ($115.55) a metric ton, the weakest since September 11.

The benchmark October iron ore on the Singapore Exchange was down 4.23% at $116.05 a ton, as of 0704 GMT, also the lowest since September 11.

“It becomes increasingly clear that demand has hit the ceiling amid weaker-than-expected steel sales for September and October, and after the replenishment of raw materials to meet production needs over the upcoming week-long holiday break came to an end,” said Pei Hao, a Shanghai-based analyst at international brokerage firm FIS.

China will begin a week-long holiday to celebrate its Mid-Autumn festival and National Day from September 29.

Chinese property stocks tumbled the most in nine months as concern over a possible China Evergrande Group liquidation added to fresh signs of stress across the industry.

A Bloomberg Intelligence gauge of developer shares fell 7.1% Monday, taking its loss in valuation this year to almost $56 billion.

Evergrande, which scrapped key creditor meetings at the last minute and said it must revisit its restructuring plan, dived 22%. China Aoyuan Group was the biggest drag on the index, slumping by a record 72% after shares resumed trading following an 18-month halt.

($1 = 7.3084 Chinese yuan)

(With files from Reuters and Bloomberg)