The price of iron ore has edged closer to the $US60 a tonne mark as doubts around Chinese demand persist.
At the end of the latest session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US60.70 a tonne, down 0.3 per cent on its prior close of $US60.90 a tonne.
It was the commodity’s weakest close since May 26, with falls of over 7.1 per cent coming during the last week of trade.
Red sessions have been seen in five of the last six sessions, with Thursday’s flat day the only break in the run of losses.
Driving the falls has been reports of a ramp up in supply from Rio Tinto after a weather-affected quarter, while softening steel prices and demand have also cast a long shadow.
Analysts believe there is little respite ahead as the Chinese summer is seen likely to be slow for the steel sector, with Citi last week reiterating its call for a fall into the $US30s at some stage this year.
“We still forecast iron ore to decline below $US40 a tonne by end-2015 as increased low-cost supply and negative steel conversion margins weigh on the market,” a Citi note read.
Source: Business Spectator
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