Xinhuanet reported that crazy iron ore price rise once sent the steel prices to fly earlier this year which but has fallen back for 4 consecutive weeks since the ore cost as a driving force weakens. Experts said the steel price falls are a necessary outcome.

During this year iron ore negotiation, the top three suppliers had tried to elevate the ore price by every means such as capping shipment, pushing it to a high level. For instance, Brazilian fine ore was approaching USD 157 per tonne in early April up from below USD 110 per tonne before the year came pulling up steel prices accordingly.

The latest data show steel price in domestic market averaged CNY 5390 per tonne at the end of last week down by CNY 236 per tonne from a week before. This indicates falls of 4 weeks in a row and at an expedited pace.

Experts said it's a necessary outcome since the previous steel price rises have been an overdraft of future cost of high priced materials.

The wide range rise of steel prices made the end users to hold a cautious attitude in purchasing steel. And hand to mouth buying is also a reason affecting price falls.

(Sourced from Xinhuanet)