Iron ore prices in Asia fell as the country curbed steel production to reduce emissions amid growing concerns about demand from China, the world's largest buyer of iron ore.
Iron ore futures on the Singapore Exchange were down 6.42 percent to trade at $95.20/ton on Monday.
The escalating risk of a significant slowdown in real estate after a debt crisis that defrauded Chinese real estate firm Evergrande helped aid the bearish trend, analysts from ANZ Research noted on Monday.
Regarding steel production, ANZ Research noted last week that another province, Yunnan, targeted mill producers tasked with restricting production in steel, aluminum and other materials.
"There were also rumors that the central government was asking producers to restore production to 2020 levels by November instead of December," ANZ Research said.
“Rail power demand is putting another pressure on smelters,” he added.
According to the data released by China's National Bureau of Statistics last week, China's crude steel production amounted to 83.24 million tons of crude steel in August, down 13.2% from the same period of the previous year. Steel production fell 10.1% year on year to 108.8 million tons in August.
ANZ Research said that August's decline in China's steel production signals that the plan to flatten steel production this year will be implemented definitively.
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