BEIJING: Iron ore futures prices flipped to its lowest level in a week on Tuesday after making gains earlier the session, on investor caution as steel demand remained subdued in top consumer China despite latest property stimulus.

The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) surrendered gains in the morning session and ended daytime trade 2.11% lower at 882.5 yuan ($121.78) a metric ton, the lowest since May 20.

The benchmark June iron ore on the Singapore Exchange was 1.59% lower at $117.35 a ton, as of 0807 GMT, also the lowest since May 20. “It’s mainly positive expectations spurred by the wave of property stimulus that lifted valuation of the ferrous market.

The latest Shanghai policy may mark an end of this round of stimulus, so the trading logic has gone back to fundamentals,” said Cheng Peng, a Beijing-based analyst at Sinosteel Futures.

Ore prices advanced in the morning session as sentiment was temporarily boosted as Shanghai, a first-tier mega city, lowered the minimum down payment ratios for home buyers and relaxed some restrictions, after Beijing unveiled ‘historic’ steps earlier in the month to stabilise its crisis-hit property market.

Other steelmaking ingredients on the DCE posted losses, with coking coal and coke down 4.08% and 1.59%, respectively. Most steel benchmarks on the Shanghai Futures Exchange ticked down. Rebar lost 0.56%, hot-rolled coil shed 0.33%, wire rod dipped 0.52% while stainless steel added 0.1%.

“The issuance of local government bonds has sped up and this will likely provide some support for rebar consumption later, but we still lowered forecast of the annual infrastructure investment growth rate to 6%-8% from 10%,” China International Capital Corporation (CICC) said in a note.

The recent property stimulus will probably not push up steel consumption directly as it focuses more on destocking, and the property sector will remain a drag for overall steel demand, CICC analysts said in a separate note.