* Australia's Arrium placed under administration
* Iron ore futures steady in China and Singapore
* Shanghai rebar edges lower
By Manolo Serapio Jr
MANILA, April 7 (Reuters) - Iron ore futures in Asia steadied on Thursday, reflecting weak buying interest in the raw material after last quarter's rally as supply rises and Chinese steel prices pull back.
The January to March rally that lifted spot iron ore by 24 percent was largely driven by a pickup in China's steel market that pushed steel prices higher as well as raw material like iron ore, said Daniel Hynes, senior commodity strategist at Australia and New Zealand Banking Group.
"But ultimately it's going to be short-lived with the structural overcapacity issue that the market has to deal with which ultimately will mean less steel production and weaker iron ore demand," Hynes said.
Amid a bleak outlook for iron ore and steel, Australian miner Arrium Ltd ARI.AX was placed in voluntary administration after the collapse of a $927 million recapitalisation plan, putting the jobs of its 7,000 workers at risk. most actively traded September iron ore contract on the Dalian Commodity Exchange DCIOcv1 was up 0.4 percent at 377.50 yuan ($58.31) a tonne by 0241 GMT, not far above Wednesday's one-month low of 368.50 yuan.
On the Singapore Exchange, May iron ore SZZFK6 was little changed at $50.92 a tonne.
Chinese steel futures were weaker. The October rebar contract on the Shanghai Futures Exchange SRBcv1 dropped 0.3 percent to 2,178 yuan a tonne.
There was limited trading activity in the physical iron ore market so far this week, traders said, following weeks of buying by both traders and mills that lifted the benchmark spot price to a nearly nine-month high of $63.30 in early March.
Underlining slow demand, stocks of imported iron ore at China's ports reached 97 million tonnes on April 1, the highest since late April 2015, based on data tracked by consultancy SteelHome. SH-TOT-IRONINV
Iron ore for immediate delivery to China's Tianjin port .IO62-CNI=SI slipped 0.4 percent to $53.80 a tonne on Wednesday, according to The Steel Index.
"I think over the next few months we're likely to see prices a little bit lower than where they have been," said ANZ's Hynes.
"But we do still feel we're probably past the worst, past the low point in the cycle. We don't necessarily see them going back to sub-$40."
Iron ore touched $37 a tonne in December, its weakest since at least 2008.
($1 = 6.4745 Chinese yuan)