* Dalian iron ore fall further from 14-month peak
* Spot iron ore was down for 4th day on Monday
* Shanghai rebar also extends losses
By Manolo Serapio Jr
MANILA, March 15 (Reuters) - Iron ore futures in China dropped further from a 14-month high on Tuesday as steel prices faltered, reflecting renewed pessimism towards a glut-hit market.
Weak futures could drag down spot iron ore prices for a fifth consecutive day as last week's massive rally fizzled.
The most-traded May iron ore on the Dalian Commodity Exchange DCIOcv1 was down 4 percent at 416.50 yuan ($64) a tonne by 0225 GMT, just off the session low of 416 yuan. The contract peaked at 454 yuan on Monday, its strongest since January last year, before ending lower.
"The recent rally continues to unwind as a weak Chinese steel market keeps buyers on the sidelines," ANZ Bank said in a note.
Chinese spot steel prices have fallen after last week's surge to multi-month highs as weekend data showed China's crude steel output dropped 5.7 percent from a year ago to 121.1 million tonnes in January-February.
On the Shanghai Futures Exchange, construction-used rebar SRBcv1 slipped 2.1 percent to 1,982 yuan a tonne, having touched an eight-month peak of 2,138 yuan on March 10.
Bids for physical iron ore cargoes in China are likely to ease further, traders say, suggesting more losses ahead for the steelmaking commodity that soared by a record 19.5 percent on March 7.
Many traders and analysts expected the pullback in iron ore, attributing the recent rally to speculative buying interest that defied the market's still weak supply-demand fundamentals.
"In our view, we hit a near-term peak in pricing, and expect a slow bleed lower for the rest of the month. With that said, we don't see prices moving materially lower until Q2," analysts at Clarksons Platou Securities said in a note.
Iron ore for immediate delivery to China's Tianjin port .IO62-CNI=SI dropped 1.1 percent to $55.50 a tonne on Monday, according to The Steel Index, marking its fourth straight day of decline.
But having risen steadily before last week, iron ore was still up nearly 30 percent for the year.
Rebar and iron ore prices at 0225 GMT
Contract
Last
Change Pct Change SHFE REBAR OCT6
1982
-42.00
-2.08 DALIAN IRON ORE DCE DCIO MAY6
416.5
-17.50
-4.03 SGX IRON ORE FUTURES MAY
48.87
-0.31
-0.63 THE STEEL INDEX 62 PCT INDEX
55.5
-0.60
-1.07 METAL BULLETIN INDEX
55.55
-1.54
-2.70
Dalian iron ore and Shanghai rebar in yuan/tonne Index in dollars/tonne, show close for the previous trading day ($1 = 6.5052 Chinese yuan)