Iron ore futures in China and Singapore fell on March 30 on renewed doubts whether the massive stimulus measures introduced across the world are adequate to buttress a global economy hammered by the coronavirus pandemic.
Worries about demand for metals also hit steel futures in China, which accounts for more than half of the world's steel output and the top exporter of steel products.
The Dalian Commodity Exchange's most-active May contract for steelmaking ingredient, iron ore, dropped as much as 3% to 640.50 yuan/t ($90.26/t), before ending the morning session down 2.8%.
Iron ore's front-month April contract on the Singapore Exchange shed as much as 2.3%.
The United States' $2 trillion economic relief package and the huge stimulus plans rolled out elsewhere have failed to ease worries about a severe economic damage due to the prolonged and intensified virus-containment measures.
"With the world going into quarantine, commodity prices have tanked, with risk assets also likely vulnerable this week as the virus continues to spread," ING economists Prakash Sakpal and Nicholas Mapa wrote in a note.
China's central bank unexpectedly cut the rate on reverse repurchase agreements by 20 basis points on Monday, the largest in nearly five years, as authorities stepped up measures to relieve pressure on an economy ravaged by the pandemic.
Concerns about iron ore supply disruptions arising from lockdowns, which last week helped lift spot and futures prices, appeared to have eased somewhat, with miner Rio Tinto Ltd saying its Shanghai team would return to office as China recovers from the pandemic.
(Writing by Emma Yang Editing by Tammy Yang)
For any questions, please contact us by inquiry@fwenergy.com or +86-351-7219322.