It ended 0.8% lower at 588 yuan, recouping losses amid renewed optimism about Beijing's economic stimulus measures. On the Singapore Exchange, the front-month September 2019 iron ore contract recovered after stretching losses earlier and was up 0.3% at $81.12 a tonne in late trade. October iron ore also bounced back, but remained below $80 level. Benchmark 62% iron ore for delivery to China, as assessed by SteelHome consultancy, settled at $86 a tonne on Tuesday the lowest since March 29.
Iron ore prices had rallied to five-year peaks on July 3 on worries about supply following mine shutdowns in Brazil for safety checks after a deadly tailings dam disaster in January, and a cyclone that disrupted miners' operations in Australia. Prices have pulled back since as supplies from Brazil and Australia recovered but remain well above the 2018 levels. Adding pressure is the weak demand outlook due to the excess steel supply in China. The glut and tepid demand for steel in top producer China have dragged prices of the construction and manufacturing material lower, putting strain on the profitability of mills.