Iron ore is on the slide, finishing at below $US80 a tonne for the first time in five years.
Last night saw spot prices fall to $US79.80 a tonne, down by more than 2.3 per cent.
It comes as a senior executive from China’s steel industry warned not to expect demand from the country to pick up.
The world’s biggest miners, BHP Billiton and Rio Tinto have said Chinese steel production will peak at 1 billion tonnes by 2030.
However Li Xinchuang, deputy secretary-general of the China Iron and Steel Association warned this will not be the case, The Australian reported.
Xinchuang said steel production in the country would not grow beyond 900 million tonnes.
“It cannot (get to one billion), trust me, I have been in the business 30 years,” he said.
“We understand it cannot go over 900 million tonnes — we think roughly 800 million to 870 million.”
Asked if miners were overestimating Chinese growth, Xinchuang said: “Maybe they keep that story for investors, I don’t know.”
He said iron ore prices would sit at around $US80 a tonne for a long period because of the volume being produced.
Yesterday’s price fall sent shivers through the industry with BHP and Rio down 3.3 and 3.8 per cent respectively.