The rout in industrial metals has claimed another victim: iron ore.
On the same day that copper tumbled nearly 7% for its biggest slide in a month, Bloomberg reports that iron ore's largest decline in 15 months is showing no signs of recovery, according to analysts:
Ore for immediate delivery may drop to $140 a metric ton by year-end, according to Macquarie Group Ltd. analyst Bonnie Liu in Shanghai. That’s down 5.2 percent from $147.70 yesterday, data from The Steel Index Ltd. show. The price may fall to the mid to low $140s, said Australia & New Zealand Banking Group Ltd.
The reason? Slow growth in China. The economy of the world's biggest steelmaker is sputtering, which means softer prices for steel and iron ore, a crucial steelmaking ingredient. Bloomberg notes steel prices have dropped to a 10-month low with port ore inventories at near highs.
The situation is being exacerbated as the Big 3 iron ore producers — BHP Billiton (NYSE:BHP), Vale SA (NYSE:VALE) and Rio Tinto (LON:RIO) , and Australia's Fortescue Metals Group (ASX:FMG) — crank out product at record levels.