CISA: 'Cornerstone' plan has boosted China iron ore output

A scheme launched by the China Iron & Steel Association (CISA) in March 2022 to raise domestic iron ore supply, steel scrap consumption and equity output of iron ore in overseas mines is already showing results, according to CISA's vice president Luo Tiejun, saying the scheme has effectively facilitated coordination among the country's central and local governments regarding the enhancement of domestic iron ore supply.

The 'cornerstone' plan aims to boost China's domestic iron ore output to 370 million tonnes/year by 2025, which translates to a 100 million t/y increase from the 2020 level, as Mysteel Global reported. The increase is in line with the country's goal to raise its self-sufficiency rate of steelmaking raw materials during the 14th five-year plan period (2021-2025).

"Since the plan was inaugurated, construction on more than ten domestic iron ore mining projects has kicked off, with their total production capacity of iron ore concentrates at some 50 million t/y," Luo told delegates attending the 2023 Steel Industry Chain Security Conference hosted by the China Metallurgical Industry Planning and Research Institute in North China's Inner Mongolia on November 23.

China is expected to see growth of 12.7 million t/y in its total iron ore concentrates production capacity in 2024, and its total concs output is estimated to rise by 15 million tonnes on year to reach 310 million tonnes, also by next year, according to Mysteel's survey.

However, "some impediments still exist on the way toward expanding domestic supply of steelmaking raw materials," Luo warned, citing three major issues that need to be addressed – namely, the slowdown in prospecting of iron ore deposits, the highly complex approval process for new iron ore projects, and the imperfect recycling system for steel scrap.

Domestic regulators should also reconsider their official response to accidents in mining operations – which usually involve collective sanction – to ensure stable production among mines, according to Luo, who argued that it is unreasonable to order all miners in a region to stop production when an accident happens to just one mine.

In addition, detailed industry standards for the steel scrap sector are also under research and formulation, he added.

"Despite adjustments being made to China's industrial structure due to economic and urbanization developments, steel demand will remain at a high level," Luo said. "Therefore, a stable supply chain of steelmaking raw materials is of great importance to the country's economic growth," he emphasized.

Written by Anthea Shi, shihui@mysteel.com

Edited by Russ McCulloch, russ.mcculloch@mysteel.com