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China's inflation figures are weak and iron ore prices have fallen due to profit-taking

The iron ore futures fell on Wednesday due to profit-taking, and lower-than-expected data for inflation in China, the top consumer. However, bets that demand would pick up, along with a resumption of production among mills, helped limit losses.

As of 0320 GMT, the most-traded contract for January iron ore on China's Dalian Commodity Exchange slipped 0.06% down to 802.5 Yuan ($112.61) per metric ton.

As of 0310 GMT, the benchmark October iron ore traded on Singapore Exchange was down by 0.56% to $106.75 per ton.

Steven Yu, senior analyst at Mysteel, explained that traders have been liquidating some long positions in order to cash in on profits. This has led to a softerening of prices.

It's not easy to predict the direction of the market and prices were largely driven by expectations. Therefore, it is normal to see a downward correction after a price rally.

China's consumer price index in August was down 0.4% compared to a year ago, which missed the poll prediction of a dip of 0.2%, and weighed on sentiment.

The Brazilian miner Vale announced on Tuesday that the fire at its maritime terminal Ponta da Madeira, which had damaged an auxiliary tower, was put out.

The fire had no impact on the miner's schedule for iron ore shipment nor the volume of steelmaking material that it expected to ship.

Ore demand is expected to increase after Chinese steelmakers resume production following the military parade in Beijing. This will limit price losses.

Coke and other steelmaking materials, such as coking coal, fell by 2.11% and 1.111% respectively.

The Shanghai Futures Exchange has seen a decline in most steel benchmarks. Rebar fell 0.67%, while hot-rolled coil fell 0.39%. Wire rod also lost 0.15%, and stainless steel remained flat. ($1 = 7.1261 Chinese Yuan) (Reporting and editing by Amy Lv, Lewis Jackson)

(source: Reuters)