BI-WEEKLY: China mines' iron ore output falls further during holiday
Accordingly, the average capacity utilization rate among these sampled mining companies dropped to 58.58% during the latest survey period, lower by 3.4 percentage points on fortnight.
Many miners and concentrating plants across the country had reduced or stopped production to start their holidays in early February, while more mills in East China reduced their output in response to the quiet iron ore market, Mysteel Global learned.
For example, capacity utilization among the 24 miners in East China that Mysteel samples averaged 55.11% during February 9-22, down by 15.33 percentage points from the previous period, with their concs output falling by 12,900 t/d on fortnight to average 46,300 t/d, Mysteel's survey showed.
Most mining companies resumed normal production this week after the holiday officially ended last Saturday, Mysteel Global learned. However, trading of domestic concs remained slack in China as the suppliers were dissatisfied with the prices their concs were fetching, market sources observed.
The bearish near-term outlook for steel fundamentals held by domestic market participants had caused iron ore prices to drop rapidly, with miners preferring to suspend sales instead, Mysteel Global noted.
By February 22, the offering price of 66% Fe grade concs in Tangshan in North China's Hebei province was assessed by Mysteel at Yuan 1,163/dmt ($163.5/dmt) EXW and including the 13% VAT, lower by Yuan 42/dmt or 3.5% from February 18.
As a result, total concs inventories held by the 186 mining companies under Mysteel's tracking continued mounting, rising by 119,500 tonnes or 11.5% on fortnight to reach 1.2 million tonnes as of February 22.
Written by Anthea Shi, shihui@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
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