Several iron ore producer stocks fell in Tuesday trading as the commodity used in making steel dropped to near six-month lows amid a glut of Chinese steel.
The price of iron ore fell by almost 5% to near a six-month low. The benchmark Australian ore for delivery to China was lower by $3.10 to $61.50 a ton, a slump by a third from two months ago when the price hit $94.5 a ton.
Iron ore traded as low as $38 a ton in 2015, which marked an eight-year low.
Citigroup sounded a note of caution in an April 17 note to clients, again, citing a slowdown in Chinese steel demand amid a global oversupply.
"We maintain a bearish view on iron ore and highlight second-half risks, particularly on the slowdown of overall Chinese steel demand growth," Citi said in the report.
Citi has a price target somwewhere in the $50s for iron ore in 2018.
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