A weak showing in the steel market was spilling over into the iron ore market, with end-users in China shunning seaborne cargoes as a result.

Platts assessed the 62%-Fe Iron Ore Index down $0.75/dmt from Friday to $95/dry mt, CFR North China.

“The steel market is still not supported as real estate sales have been tanking of late and demand is weak,” a Beijing-based trader said. “Add to that the seasonal lull in demand for steel because of the hot weather in China, and you will get poor steel sales and margins. Iron ore demand will suffer because of lackluster steel performance.”

A Shanghai-based trader said actual trading activity had calmed a lot and the week appeared to open on a quiet note.

“There’s a lot of uncertainty in the market now so I think everyone’s just waiting to see what will happen before they buy or sell anything,” he said.

“Prices appear to be on the softer side and I think we’re also anticipating a continued slide, so mills don’t want to buy large Capesize seaborne cargoes now as well,” a trader in Zhejiang said. “It’s quiet, overall.”

A Zhejiang-based steelmaker added that for the rest of the year, the crucial thing to look at would be the demand situation for iron ore, since the supply overhang was something that was going to stay.

“We all know about the mining output increases from the major producers so the key thing to look at will be demand, but downstream demand doesn’t look like it will be all that great,” the steelmaker said. “Primarily, this is because the real estate and construction markets don’t look too good, and these are major consumers of steel product. Steel demand will keep going down, which will then impact iron ore demand negatively.”

Meanwhile, steel rebar futures declined Monday, with the most actively traded January contract in Shanghai last trading at Yuan 3,042/mt ($494.25/mt), down Yuan 9/mt from Friday, and settling at Yuan 3,052/mt, down Yuan 34/mt on the day.

Steel billet prices also eased Monday, with the physical spot price of square billet in Tangshan going down Yuan 10/mt from Friday to Yuan 2,700/mt ($438.75/mt) ex-stock Tangshan, a Beijing-based trader said.