Iron ore prices fell on Friday as industrial demand in China remained stagnant due to steel production cuts in the country.
According to data from Mysteel consultancy, the capacity utilization rates of 163 blast furnaces at facilities across the country decreased to 62.39% as of November 5, from 66.17% in the previous week.
The benchmark 62% Fe fines for imports into northern China were changing hands at $93.14 per tonne, down 7% from Thursday's close, according to Fastmarkets MB.
Top-traded iron ore futures for January delivery on the Dalian Commodity Exchange fell 3.2% to 561 yuan ($87.65) per tonne. The contract is down 12.1% this week.
"We expect iron ore prices to find a base at current levels," ANZ Research said in a note.
“However, the restrictions on China's steel production are likely to last until after the Beijing Winter Olympics, so upside seems limited in the short term.”
Weekly steel consumption in the world's largest metal consumer also fell 2.3 percent from the previous week, according to Mysteel.
"The expectation centered on lower costs and weak demand will drive steel prices further," Galaxy Futures analysts said in a note.
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