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Iron ore prices retreated on Tuesday after China’s commodity exchanges moved to raise trading limits and margin requirements for some contracts and reinstated fees on steel futures.

After a record high on Monday, Benchmark 62% Fe fines imported into Northern China (CFR Qingdao) was down 0.7%, changing hands for $228.93 a tonne, according to Fastmarkets MB.

The Dalian Commodity Exchange vowed to “severely punish” unspecified violations in iron ore trading.

The Shanghai Futures Exchange also pledged to tighten trading on steel, while the Zhengzhou bourse made a similar move on thermal coal.

“Most market participants believe the surge (on Monday) was a speculative move,” ING Economics said in a note.

But optimism over supportive policies and robust demand would support the iron ore market, it added.

Chinese steel rebar and hot-rolled coils futures closed at record highs, rising as much as 6.7% and 7.7% respectively, as production curb worries and peak season demand overshadowed a fee adjustment by exchanges.

The state planner has urged local governments to complete “self-inspection” for their steel projects and full-year output cut plan by mid-May before it conducts on-site checks in June and July.

The announcement, seen as a curtain raiser for more crude steel production curbs, came as China’s factory gate prices expanded at the fastest pace in more than three years last month.

“Current demand for construction materials is still robust… domestic hot-rolled coils prices are also driven by a surge in overseas markets,” an analyst with CITIC Futures wrote in a note.

(With files from Bloomberg and Reuters)