CHINESE commodities prices spiralled lower Friday, with steel futures suffering their worst week since 2009, as more money flowed out of markets whose surge two weeks ago unnerved global investors and forced regulators to step in to restore calm.

    Indicating how authorities may now be alarmed after a collapse in volumes and prices, the Dalian Commodity Exchange on Friday said it will cut some trading fees on contracts such as iron ore and coking coal.

    Commodities linked to China’s steel sector, which led the mid-April rally, were the hardest hit Friday, on worries that demand in the world’s biggest steel consumer could soon wane. The selloff spread to agricultural products including soybeans, eggs and cotton.

    Some traders were concerned that China’s interest rate easing cycle could be over even as optimism about prospects for the world’s No.2 economy faded.

    The retreat pulled prices of many of the commodities below levels in mid-April, when a buying frenzy, pinned on retail investors, bloated volumes and drew comparison with the boom-and-bust cycle in China’s stock markets last year.

    The price declines suggest that Chinese exchanges have more than succeeded in popping the bubble, after commodity platforms in Dalian, Shanghai and Zhengzhou launched measures to curb speculative buying.

    A tighter steel market following shutdowns of Chinese mills in the past year and a seasonal pickup in demand helped spur prices in the past two months. But producers have since ramped up output and once-shut plants have also resumed production. (SD-Agencies)