Chinese iron ore futures are still getting thumped, falling to a fresh six-week low on Wednesday.

Here’s the scoreboard at the lunchtime break in China:

SHFE Rebar ¥3,443 , -2.30%
DCE Iron Ore ¥672.50 , -3.38%
DCE Coking Coal ¥1,286.50 , -0.89%
DCE Coke ¥1,876.00 , -0.82%

From the highs of last week, the May 2017 iron ore contract has now fallen by 8.5%. At 672.5 yuan a tonne, it now sits at the lowest level since February 10.

The declines in iron ore mirror a similarly large decline in steel prices over the same period.

It’s the latter that Vivek Dhar, mining and energy commodities analyst at the Commonwealth Bank, believes is driving the price action in iron ore at present, suggesting that steel prices fell on Tuesday after the Chinese government reportedly announced that they want steel price increases to be linked to stronger downstream demand.

“The announcement comes despite China’s commodity intensive sectors posting impressive numbers in January and February,” says Dhar, noting that “policymakers have already signalled their intent for stable growth this year, which will likely be backstopped via infrastructure investment.”

Others suggested that heightened levels of speculation in futures markets contributed to the decline, creating short-term volatility as momentum swings dictated investment decisions.

The drop in futures markets clearly impacted spot markets on Tuesday the with the spot price for benchmark 62% fines slumping by 4.26% to $87.59 a tonne, extending its decline from Thursday last week to 5.4%.

The fall on Thursday was the largest in percentage terms since December 14 last year.

Based on the price action in futures today, there may be further declines to come.

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