Seaborne iron ore prices continued to slide on Tuesday as a lack of confidence in steel price diminished willingness to restock raw materials. The prospect of growing restrictions on Chinese real estate has also hurt sentiment, although the impact on steel demand is unlikely to be immediate.

The Kallanish index for 62% Fe Australian fines dipped another $0.28/t to $55.55/dry metric tonne cfr Qingdao. 200,000t of Carajas fines and 170,000t of Standard Sinter Feed Guiaba traded on GlobalOre for November delivery at floating prices.

They main reason behind the decline is the loss of confidence in steel prices. While many had expected restocking and price increases to continue until the October holiday, inventories are now falling with prices as nobody wants to be left holding stock. That lack of positive sentiment is combining with the fact that mills already have iron ore stocks and are seeing their positive margins steadily vanish. That means a fall in steel output will be necessary and even less need to restock ore.