At the end of the latest offshore session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US54.50 a tonne, in line with its previous close.

The commodity could have been expected to recover some of the over 5 per cent losses seen on Wednesday night given the falls came ahead of the Federal Reserve’s dovish monetary policy outlook, but yesterday trade brought no respite, with the commodity remaining at a six-year low.

Iron ore prices have been falling sharply amid an oversupply, with the tactics of mining heavyweights BHP Billiton, Vale and Rio Tinto again coming under question yesterday as West Australian Premier Colin Barnett said the miners had read the situation “dramatically wrong”.

“This has been one of the dumbest corporate plays I think I’ve ever seen,” he told ABC Radio.

“The two big ones in Western Australia and the Brazilians have been putting too much iron ore into the market and they’ve precipitated a continuing downward trend in iron ore prices.”

Rio, BHP and Vale still maintain healthy margins given operating costs that have fallen below $US20 a tonne, but those margins are sharply below where they where at the start of 2014 as the iron ore price sat above $US135 a tonne.

Mr Barnett’s comments come amid a flurry of downgrades to forecasts as several analysts foresee a floor price around the $US50 a tonne mark.

Among analysts trimming expectations in the past week have been UBS and HSBC, while the federal government’s Department of Industry and Science now expects an average price of $US60 for 2015. That compares unfavourably to its prior expectation of $US63, declared in a December report.

However, the government projection, which came out just ahead of the 5 per cent slump on Wednesday night, is already at risk of proving optimistic, casting a further shadow on the federal budget.