It’s not been a good Tuesday session for iron ore futures in China, at least so far, with prices tumbling back below the 700 yuan a tonne level, extending the losses from early last week to 6.7%.

Here’s the scoreboard at the mid-session break:

We’ve included rebar, coking coal and coke futures for two reasons.

The first two show that steel futures have also fallen heavily, and that the weakness in rebar and iron ore has not transferred to other steel-making ingredients such as coal.

“With iron ore prices so leveraged to steel prices at the moment, market conditions in China’s steel sector are increasingly becoming more important, said Vivek Dhar, mining and energy commodities analyst at the Commonwealth Bank, referring to ongoing concerns over bloated iron ore inventories held at Chinese ports.

“With steel stockpiles now at levels seen in early 2015, we may finally be at the end of China’s restock cycle, curbing a key upside driver for steel prices.”

That, in turn, may also act as a headwind for iron ore prices should Dhar’s assessment prove correct.

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