Dalian iron ore price fell more than 8% on Friday after Chinese regulators and industry association issued warnings of the recent unusual price movements of the key steelmaking component.
Earlier on Friday, the country's state planner, the National Development and Reform Commission (NDRC), said he and the market regulator would send investigative teams to the commodity exchange and major ports to examine iron ore stocks and trade on-site.
The NDRC, which has released three public announcements so far this year after iron ore prices rose more than 20%, said it warned information providers not to make any news or raise prices and promised to take action against any irregularities.
After the state planner's announcement, the Dalian exchange doubled the transaction fees for some iron ore futures contracts.
Meanwhile, the China Iron and Steel Association said on Friday night that it found some companies involved in iron ore enterprises "violated business ethics" by publishing and exaggerating false information, which seriously disrupted the market order and harmed the rights of market participants.
"Prices could weaken as market sentiment impacts, while officials are keeping a close eye on iron ore," analysts at GF Futures wrote in a note. said.
The most actively traded iron ore futures contract on the Dalian Mercantile Exchange was around 766 yuan ($120.53) per tonne, down more than 8 percent as of 1333 GMT. It rose nearly 6% in the early hours of Friday and closed the ton at 805 yuan in afternoon trading.
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