Iron ore and steel futures in China declined on Wednesday, extending losses into a second session, as poor industrial profits data highlighted a slowdown in manufacturing in the world's second-largest economy.

Profits earned by China's industrial firms shrank at their fastest pace in eight months in October, according to data released by the National Bureau of Statistics, tracking sustained drops in producer prices and exports.

Benchmark Dalian iron ore futures prices, for January 2020 delivery, dived as much as 2.6% to 639 yuan ($90.78) per tonne and closed at 642 yuan per tonne.

The most traded construction steel rebar on the Shanghai Futures Exchange, declined 1.2% to 3,596 yuan a tonne.

Hot-rolled coil, used in cars and home appliances, dipped 0.4% to 3,522 yuan per tonne.

However, analysts were optimistic about steel demand in China.

"China will remain the driving force behind global steel production," Fitch Solutions Macro Research said in a note, adding that it estimates the country will account for more than half of the global output in 2019.

Figures from the World Steel Association showed global steel output fell 2.8% in October, but rose by 3.2% in the first ten months after gains earlier in the year in China.

Shanghai stainless steel futures, for February 2020 delivery, declined 1.6% to 14,220 yuan per tonne.

Other steelmaking ingredients also fell, with Dalian coking coal sliding 0.8% to 1,231 yuan per tonne and Dalian coke ticking down 0.4% to 1,865 yuan per tonne.

Rio Tinto Ltd said on Wednesday it had approved a $749 million investment in its Greater Tom Price operations to help sustain production capacity in its iron ore business in the Pilbara region of Western Australia.

The European Commission opened an investigation on Tuesday after finding evidence that Chinese steel producers are avoiding anti-dumping duties by slightly modifying the material they export.

Profits at China's state-owned firms rose 5.4% year on year in Jan-Oct period, the finance ministry said.