SHANGHAI, Aug 5 (SMM) – Iron ore prices on the Dalian Commodity Exchange slumped on Monday August 5 amid speculative selling, with the October and November contracts down by their daily limits. 

This extended declines from last week when re-escalated US-China trade tensions weighed on prices, following increases at the start of last week as Wu’an and Tangshan’s anti-pollution plans for August indicated looser output controls.

SMM expects growth in both supply and demand to keep prices of seaborne prices rangebound at highs this week, with pessimism over macroeconomic development capping any momentum in prices.

Poor performance of finished steel products and squeezed margins at steel mills, which dampened iron ore purchases, also lowered futures and spot prices of iron ore. 

Market pessimism was intensified at the end of last week by the announcement of heating-season production controls in Linfen of Shanxi province. But this may cause little impact on near-term prices as the controls will not take effect until November 15. 

As of Friday August 2, traded price of PB fine in Shandong decreased an average 20 yuan/mt from a week ago to 850-855 yuan/mt, with prices in Tangshan climbing 5 yuan/mt on the week to 875-880 yuan/mt, SMM assessed. The price difference in Tangshan and Shandong continued to grow. 

SMM’s price index MMi for spot iron ore with Fe 62% rose 10 yuan/mt on the week to 894 yuan/mt as of Friday August 2. This translated to $120.73/mt cfr, up $1.05/mt on the week.