The iron ore price rise through July to over $70/dry metric ton is likely due to a temporary steel restocking cycle in China, and prices will fall to the mid-$50s/mt CFR China level or below in the fourth quarter of 2017, Barclays investment bank said in a report late Tuesday.

Restocking trend has boosted iron ore prices, on top of supportive macroeconomic conditions in China which had been aiding demand, Barclays said in a report.

“Good demand conditions alone are not sufficient to explain the recent price movements,” Barclays analyst Dane Davis in New York said in the report.

“We think that a steel restocking cycle is currently taking place, supporting the rally for the bulk material. As a result, iron ore priced at $70/mt looks unsupported, and we think that a reversion to a mid-to-low $50/mt handle by fourth-quarter 2017 is increasingly likely,” he said.

The Platts IODEX 62% Fe iron ore import price reference reached $74/dmt CFR China this week, up from $63/mt assessed at the end of June.

“Even if we assume demand conditions remain supportive, we see the price outlook as still under downward pressure,” Barclays wrote.

Source-plaltts