GACC: China's iron ore imports climb 5.5% on year in Q1
Despite the slight on-year rise of 0.5% in March, last month's import volume of 100.7 million tonnes was still at a high level, having sneaked over the 100 million-tonnes threshold, Mysteel Global notes.
In fact, China's iron ore imports have performed rather strongly this year, Mysteel Global noted. Additionally, non-mainstream suppliers of iron ore such as India made a more significant contribution to the on-year increase, the Customs statistics show.
On the other hand, Q1 also witnessed a weakness in domestic steelmakers' demand for iron ore, due to their slower ramp-up of hot metal output than during January-March last year.
The subdued enthusiasm for production among mills can be attributed to the slow revival in domestic steel consumption this spring and the mills' financial constraints, market sources observed.
For example, by March 28 only around 29% of the 247 Chinese steelmakers Mysteel regularly checks had managed to keep their steel margins positive, representing a drastic drop from last year's 59%. Also, the 247 mills' hot metal output during March 22-28 was 9.1% lower than in the corresponding period in 2023.
As a result, with iron ore supply generally robust and demand being lackluster, China's port iron ore stockpiles have been steadily mounting this year. The volume at China's 45 major ports under Mysteel's monitoring had topped 144.3 million tonnes by March 28 for an on-year gain of 2.7%, and further rises in stocks were noted this week.
Moreover, iron ore market fundamentals – specifically the oversupply of ore – also suppressed iron ore prices in Q1, causing the Mysteel SEADEX 62% Australian Fines index to tumble by $45.2/dmt from January 2 to reach $97.8/dmt CFR Qingdao on March 29.
Looking ahead to this quarter, iron ore imports are expected to remain at high levels, while market pundits predict the rise in demand will be only modest, Mysteel Global noted. Consequently, these are likely to exert further pressure on the continued accumulation of iron ore port inventories and a decline in import ore prices over the April-June period.
Written by Lea Li, liye@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
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