Chinese iron ore imports rose in September, according to Reuters data, as its steelmakers ramped up output in the face of global trade tensions about the country’s steel exports.
Thomson Reuters Supply Chain and Commodity Forecasts data showed 82.5 million tonnes of iron ore, which is used in steelmaking, arrived at Chinese ports in September – up 2.5 percent on August and not far off July’s near record levels.
The data, based on ship tracking and port figures, does not completely tally with official Chinese customs figures, but typically doesn’t vary from them by more than 4 percent. China, which consumes some two-thirds of global sea-born iron ore, will release official trade figures for last month on Oct 8.
Julius Baer analyst Carsten Menke said China’s iron ore imports could remain strong through the year but only because steel mills will substitute more domestic ore with cheaper, imported ore, not because of rising steel demand or prices.
“There’s a lot of ore coming to China at the same time as steel demand slows down seasonally.”
China’s 2016 steel exports remain on track to beat last year’s record 112 million tonnes, despite coming under fire from global rivals, who have accused it of dumping cheap exports after a slowdown in demand at home.
Its steel output has fallen just 0.1 percent in the first eight months, according to World Steel Association figures, despite Beijing’s pledge to cut excess steel capacity by 45 million tonnes this year.
In the first 10 days of September, steel output at China’s big mills rose 4.6 percent from the preceding period and was the highest since June, helping explain the firm ore imports levels indicated in the Reuters data.
Also tempting mills to import more ore was a 6 percent decline in ore prices last month, though going forward, the demand outlook should dim amid a winter construction lull and as the effects of this year’s government stimulus fade.