The price of iron ore fell sharply on the futures market in Singapore on Friday. The price came under pressure after a call from the Chinese steel branch association to the Chinese government to “maintain order” on the iron ore market.
The price of a ton of iron ore fell by as much as 6.2 percent to more than $ 107. Monday reached the highest level in five years, partly due to bad weather in Australia, which disrupted deliveries of iron ore to China. Industry association China Iron & Steel Association said that prices have risen too strongly and would like them to return to “reasonable” levels. An investigation has been requested into the rally that the iron ore price experienced recently.
According to the industry group there are no longer any supply problems with iron ore, because production in Brazil is recovering after a dam fracture at a mine earlier this year and Chinese domestic production is growing. Possibly oversupply may occur in the second half due to a weakening steel production in China, according to the trade association.