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The price of iron ore fell to fresh five-year lows on Wednesday November 26.

The 40 base point cut in the one-year lending interest rate to 5.6% on November 21 prompted a $3 pick-up in derivatives prices on the day, but all gains were given back by the end of Monday’s trading session.

The cut failed to have anything but a minor effect on physical prices, which remained largely unmoved on Monday before sliding to new lows.

Metal Bulletin’s benchmark seaborne 62% Fe iron ore price now stands at $68.49 per tonne cfr China, down by $1.09 on the day and at its lowest point since mid-2009.

The march down in physical prices on Wednesday was pre-empted by further weakness in the paper market, which saw derivatives prices on the Singapore Exchange, for settlement in January, slide to lows of $68 per tonne.

Depressed sentiment and uncertainty over the extent of any future recovery in prices have pushed forward contracts for the 2016 calendar year as low as $63.75 on the Singapore Exchange.

“The sheer pace of the move south does not given confidence that the market is finding support or that it will find support at these levels,” analysts at brokerage firm FIS said.

The interest rate cut has also failed to have any sustained positive effect on Chinese steel prices. Tianjin Xiangshi Investment’s Bin Yixiang said on Wednesday that an increasingly bleak outlook for China’s property sector and weakening exports would constrain rebar prices.

Expectations that steel output would increase, following a series of output cuts ahead of the Asia Pacific Economic Cooperation (APEC) meeting in Beijing earlier this month, have not been fulfilled.

The latest crude steel production data published by the China Iron & Steel Assn (Cisa) showed no pick-up in output following the APEC conference, with output at Cisa member mills totalling 599 million tpy – up by 0.4% over the preceding ten days but down by 6.2% year-on-year.

“The lack of steel orders has weighed heavily on steel mills’ appetite to purchase iron ore, even after Friday’s rate cut,” analysts at Australian investment bank Macquarie said.

Rumours that a physical cargo of lower-grade iron ore had been offered at $6 per tonne lower than the market price on Wednesday prompted fears of further price falls.

“We heard that a Yandi cargo was being offered to South Chinese mills at $55 per tonne – $6 per tonne under market, with no takers. If true, this suggests the Fe 62% market has further to fall,” Standard Bank said.

Metal Bulletin’s 58% Fe premium index was calculated at $61.94 per tonne on Wednesday.