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||Iron ore hits 21-month low; China rebar, ore futures extend losses
Iron ore futures in China slid to a fresh low Friday as a supply glut smothered a market faced with slower steel demand, pushing spot iron ore prices to their lowest since September 2012.
Chinese steel futures fell to their weakest since the market started in 2009 as consumption of the alloy slows along with the pace of construction activity during China's hotter summer months.
Iron ore for September delivery on the Dalian Commodity Exchange hit a session low of 659 yuan ($110) a tonne, including taxes, its lowest since the bourse launched the contract in October last year.
It was down 0.9 percent at 664 yuan by 0157 GMT, and has lost 3.5 percent for the week, on track for a sixth weekly loss in seven.
Spot prices also fell, hitting a fresh 21-month low on Thursday. Benchmark ore with 62 percent iron content <.IO62-CNI=SI> dropped 2.1 percent to $91.50 a tonne, the lowest since Sept. 7, 2012, according to data compiler Steel Index. It was down more than 3 percent for the week so far, its eight weekly loss in nine.
"Those who are buying are targeting lower and lower prices every day. Supply is abundant and sentiment is weak," said a trader in Shanghai.
Iron ore fell below $100 a tonne on May 19 and has lost almost 32 percent this year, potentially curbing profits at top miners Vale , Rio Tinto and BHP Billiton .
Citigroup said on Tuesday it sees "robust downside support" for iron ore at $90 a tonne, adding that most Chinese traders consider prices below $100 good value.
"I don't think $90 would be a strong support level for the moment, I'm looking at closer to low $80s," said the Shanghai trader.
The most-active rebar for October delivery on the Shanghai Futures Exchange fell to as low as 3,015 yuan a tonne, its weakest since the exchange introduced rebar futures in March 2009.
Shanghai rebar futures and iron ore indexes at 0157 GMT
Contract Last Change Pct Change
SHFE REBAR OCT4 3028 -6.00 -0.20
DALIAN IRON ORE DCE DCIO SEP4 664 -6.00 -0.90
SGX IRON ORE FUTURES JULY 89.7 -0.88 -0.97
THE STEEL INDEX 62 PCT INDEX 91.5 -2.00 -2.14
METAL BULLETIN INDEX 91.17 -2.85 -3.03
Dalian iron ore and Shanghai rebar in yuan/tonne
Index in dollars/tonne, show close for the previous trading day
($1 = 6.2106 Chinese Yuan Renminbi)