Iron ore spot prices have fallen below $US$70 a tonne for the first time since July, shedding 3.5 per cent overnight. The spot price was today at $US68.30 a tonne, with futures also indicating weak prices.
ANZ senior commodities analyst Daniel Hynes said the fall followed comments by the Reserve Bank of Australia in its September meeting, the minutes of which were released yesterday.
“The weaker sentiment in the market was fuelled by comments from the RBA, which said prices are expected to fall ahead of the ongoing expansion of the global iron ore supply chain,” he said.
“They also suggested steel production per capita was close to its peak and that growth to steel production would not add much to iron ore demand in the future.”
CMC Markets chief market analyst Ric Spooner said that while a pull back from recent iron ore price highs has been long expected, the onset of a downward trend will likely create “nervousness” about how far it will fall.