Why iron ore futures prices plunged 10% today

The most-traded iron ore for May delivery on China's Dalian Commodity Exchange tumbled as much as 9.7% to 701 yuan ($110.35) a tonne, its weakest since Jan. 18.

The steelmaking ingredient's front-month March contract on the Singapore Exchange slumped by as much as 11.4% to $131.55 a tonne.

"Iron ore futures remained under pressure amid China's determination to limit speculative price gains," ANZ commodity strategists said in a note.

The continued sell-offs reflected growing investor jitters, with Chinese publication Economic Observer reporting that China's state planner and market regulators were scheduled to summon some domestic iron ore traders later in the day for a "reminder and warning symposium".

China's state planner, the National Development and Reform Commission, has doubled down on a warning issued last week against unspecified information providers that it claimed were fabricating iron ore prices. It said teams would be dispatched to look into inventories at ports and trading in spot and futures markets.

In what appeared to be a concerted effort to cool a sustained rally - Dalian iron ore hit its highest in more than five months last week - the Dalian exchange has announced an increase in the transaction fee for futures contracts for February to May deliveries.

Spot prices of benchmark 62%-grade iron ore in China have pulled back, trading at $149 a tonne on Monday, from a near six-month high of $152.50 last week, data from consultancy SteelHome showed.

Construction steel rebar on the Shanghai Futures Exchange fell 2.5%, while hot-rolled coil shed 2.3%. Stainless steel rose 1.3%.

Dalian coking coal was virtually flat, while coke slipped 0.1%.

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.