Iron ore is in full-scale retreat, with futures in China plunging to end limit-down on investor concern about the outlook for demand in the world's top user, fresh signs of burgeoning supply from Australia and the hostile backdrop of a broad-based sell-off in base metals.

"Iron ore's centre of gravity is constantly moving lower," said Zhao Chaoyue, an analyst at China Merchants Futures Co.

BHP has published production data for the December quarter. Credit:Bloomberg

"Concerns about the glut have always been there. Port stockpiles are maintaining near a record and there's a consensus that supply will go on expanding, especially in the second half."

The raw material sank into a bear market last month amid concern supplies are rising just as China's mills enter a weaker period for demand. The steel industry's purchasing managers index for April fell below 50, signalling a return to contraction, according to data at the weekend. And figures on Thursday showed shipments from Port Hedland, Australia's main terminal, rose to the highest this year even as holdings at ports in China remain near a record high.