2 Min Read
* Dalian iron ore losses more modest after Monday's 7-pct plunge
* Spot iron ore only down slightly on Monday
By Manolo Serapio Jr
MANILA, Dec 20 (Reuters) - Chinese steel and iron ore futures extended their losing streak into a fifth day on Tuesday as investors continued to lock in gains after this year's searing rally with year-end approaching.
The losses add to iron ore's slide of more than 7 percent on Monday amid signs of ample supply as inventories of the steelmaking raw material at Chinese ports hit a two-year high.
Steel prices had also pulled back from last week's 32-month peak as demand in the world's top consumer tapers off during the seasonally slow winter period.
The most-active rebar on the Shanghai Futures Exchange was down 2.4 percent at 3,174 yuan ($457) a tonne by 0211 GMT. The construction steel product fell as far as 3,118 yuan, a two-week low.
On the Dalian Commodity Exchange, iron ore also touched a two-week trough of 558.50 yuan per tonne and was last down 1.1 percent at 572.50 yuan.
The weakness in futures reduced transactions in the physical market, although despite Monday's 7-percent slump in Dalian iron ore, the spot benchmark, only dropped marginally.
Iron ore for delivery to China's Qingdao port .IO62-CNO=MB slipped 0.3 percent to $81.22 a tonne on Monday, according to Metal Bulletin.
Wang Di, analyst at CRU consultancy in Beijing said that since last week, the futures price has been at a premium over the spot price, "so that's probably why futures are coming down a bit", narrowing the gap with spot.
"From the fundamental side, total demand for iron ore is still holding steady at this point," said Wang. "Steel mills are still making money, so it indicates that end-user demand remains firm."
Despite recent weakness, spot iron ore has gained 86 percent this year, while Dalian futures have surged more than 180 percent.
$1 = 6.9506 Chinese yuan Reporting by Manolo Serapio Jr.; Editing by Joseph Radford