With China's property market suffering a decline, analysts speculate the world is heading for a severe recession as weakening global steel production will depress iron ore prices further, pulling along with it prices of other commodities.

China has been the largest importer of the world's iron ore, taking as much as half for some years now. Its hunger led to many iron ore explorations and drillings, and contributed large amounts to the coffers of mining companies. Moreover, those shipments drove the prices of commodities for almost a decade.

But in October, China's imports of iron ore slid 17.5 per cent month-on-month to 49.9 million tonnes.

Iron ore is an essential component to produce steel. An active buying of iron ore corresponds to high steel production output, which means high and active infrastructure growth in any country.

But steel prices have performed dismally this year. Davy, an Irish-based brokerage firm, said in the Telegraph that European and U.S. steel prices will likely fall in the next three months by as much as 2 per cent to 3 per cent, and thus push prices further down 10 per cent to 15 per cent year-on-year.

Albeit iron ore spot prices recovered marginally last week, the commodity has collapsed from a high $180 a tonne. It now currently sells under $138 a tonne.

Figures quoted by Business live of iron ore delivered recently to China's Tianjin port showed the commodity sold for $134 a ton. Stockpiles are currently mounting in China because steelmakers are deferring deliveries.

And as global economic fears continue and further escalate, a level below $100 for iron ore prices is "possible," Davy said.

Global demand for steel is affected by consumer appetite for products such as motor vehicles, new houses, among others.

https://www.ibtimes.com/articles/244379/20111107/stingy-chinese-shake-commodities-boom-turn-kaput.htm