WEEKLY: China mills' imported iron ore use drops
Some steel mills in Tangshan in North China's Hebei were requested by local authorities to rein in their sintering operations from June 2 in response to deteriorating air quality readings in the city, Mysteel Global noted, with similar restrictions being placed on some mills in Hebei's Qinhuangdao from June 3 for the same reason. The curbs in both cities had yet to be lifted as of late Thursday afternoon.
In fact, out of the six cities and regions under Mysteel's survey, only Tangshan recorded a week-on-week decline in ore use among its mills during the period, with the daily usage of sintering fines lower by a large 8.7% on week to a six-month low of 147,000 tonnes/day on average over June 1-7.
On the other hand, inventories of imported iron ore sintering fines stockpiled at the 64 sampled steel mills had shrunk to 9.1 million tonnes by June 7, refreshing its lowest level since Mysteel commenced the survey in July 2014. The stocks had thinned for the fourth straight week by 2% on week.
At the current rate of consumption, the existing stocks should be enough to keep these mills operating for around 15 days, one day shorter than during the previous period.
Those mills that were required to curtail sintering slowed their iron ore buying this week, a Shanghai-based market watcher said to explain the steelmakers' lower ore stocks.
As for most mills, "the recent increase in imported iron ore prices dampened their demand for the feedstocks," the Shanghai source added.
During the survey week, Mysteel PORTDEX 62% Australian Fines in Qingdao grew to Yuan 833/wmt ($116.8/wmt) FOT and including the 13% VAT, up by Yuan 45/wmt on week.
Written by Lea Li, firstname.lastname@example.org
Edited by Zhenqi Yang, email@example.com
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