Reuters reported that Chinese steel and iron ore futures dropped for a second session on Monday after weak manufacturing data added to signs of a slowdown in Chinese economy, which may curb its demand for the two commodities.

The most traded rebar for October delivery on the Shanghai Futures Exchange was down 0.7% at CNY 3,207 per tonne by midday. Iron ore for delivery in September on the Dalian Commodity Exchange eased 0.1% to CNY 734 per tonne.

Activity in China's factories slowed for a fifth straight month in March with a key index touching an eight month low, a preliminary private survey showed, raising market expectations that the government may provide stimulus measures to aid the economy.

Mr Wu Wenzhang president of Chinese industry consultancy SteelHome said that “China's economic restructuring will lead to slower growth in steel demand this year. We think Chinese demand for crude steel will rise 2% to 3% and about 5% for iron ore imports."

Demand for crude steel in China, the world's top consumer and producer, grew 7.1% last year and its imports of raw material iron ore gained 10.2%. China is enforcing reforms to drive an economic expansion that rely more on domestic consumption than investment.