China’s iron ore imports rose 11 percent in September from a year earlier to a record high, according to customs data on Friday, even as steel mills in the world’s top producer prepared for winter production cuts.
Arrivals last month reached 103 million tonnes, data from the General Administration of Customs showed, topping the previous record of 96.5 million tonnes in March. That was up from 92.99 million tonnes a year ago and 88.66 million tonnes in August.
For the year to date, imports were 817 million tonnes, up 7.1 percent. At the current pace, the world’s largest iron ore consumer would likely beat last year’s record-setting import total of 1.02 billion tonnes.
Beijing has ordered winter steel production cuts across the north of the country, including some key steel-producing regions including Hebei, Shandong and Shanxi, from November as part of efforts to meet pledges to reach air quality targets.
That has raised concerns that mills will need less raw material. Steel mills have churned out record volumes in recent months ahead of the cuts in a bid to build up inventory and take advantage of surging prices and the best profit margins in more than a decade.
Daniel Hynes, commodity strategist at ANZ, said he expects arrivals to remain strong as mills seek higher quality raw material needed to comply with the government’s crackdown on low-grade steel furnaces.
“If the steel mills are impacted by those production cuts over the winter, then it would normally be more pertinent for them to restock during that period rather than do it now,” said Hynes, speaking after the numbers were released.
Prices of steel rebar jumped 46 percent this year.