Iron-ore plummeted as Beijing ramped up a campaign to stop prices overheating even before the government rolls out demand-boosting stimulus measures this year.

Prices tumbled more than 11% in Singapore on signs that authorities in China will intensify efforts to quell a big rally since mid-November. Several iron -companies were reportedly called to a meeting with the economy’s top planning body in Beijing, while the official China Daily newspaper railed against what it called “guerrilla war” by speculators in China and outside.

“The government’s rhetoric on cracking down on iron ore prices is expected to drive trading for the near term as the market awaits more specific measures,” Wei Ying, an analyst with China Industrial Futures, said by phone.

The fresh regulatory attention highlights a difficult balancing act for Beijing, which wants to steady the economy -- boosting steel consumption -- without reprising last year’s damaging bout of commodity inflation. Beijing will focus more on growth and increased infrastructure spending in 2022, according to Mike Henry, CEO of major miner BHP Group.

Headwinds for iron ore including steel-output curbs will relax this year, according to Henry, who spoke after the company posted record half-year earnings. Iron ore prices will remain extremely volatile long into the future, he said.

Iron ore had risen more than 60% from mid-November to smash through $150 a ton last week, triggering initial actions by regulators including port checks, higher futures trading fees and a warning against disinformation.

LET’S TALK
Now, some iron-ore trading firms were called to a meeting with the powerful National Development and Reform Commission to discuss how ensure “smooth operation” of the iron ore market, according to the state-owned Economic Observer.

And an editorial in the English-language China Daily urged stronger steps to stabilize prices as the government boosts cyclical demand including infrastructure spending. The paper blamed “domestic and foreign capital” for fueling speculative price gains.

Still, some analysts question whether efforts to rein in prices can have lasting impact if the physical market tightens further.

“History has taught us that these sharp plunges after Chinese rhetoric on investigating and supervising iron ore prices are short and temporary,” said Atilla Widnell, managing director at Navigate Commodities. A fall in supplies from Australia and Brazil -- together with rising steel production -- have created a very finely balanced market, he said.

Futures on the Singapore Exchangewere down 11.4% at $131.55 a ton by 1:22 p.m. local time. On China’s Dalian Commodity Exchange, prices dropped as much as 9.7% -- very close to their daily limit.