[SMM Iron Ore] China's iron ore imports edge up in August and set for a stronger month on shipments and restocking

According to the latest statistics from the General Administration of CustomsChina imported 108.539 million mt of iron ore and concentrate in August, up 0.42% month-on-month and 3.32% year-on-year. Imports over January to August totalled 845.271 million mt, up 5.5% year-on-year.

Looking back at August, iron ore fundamentals stayed in a weak-driver pattern, with supply comfortable and demand broadly steady. On the supply side, typhoons and strike action brought short-lived disruptions that pulled shipments and arrivals lower towards the end of the month, though the broader picture of ample supply was unchanged. On the demand side, pig iron output edged higher through the month, lending some support to rigid demand for iron ore.

Looking ahead to September, both shipments and arrivals are expected to pick up. The third quarter marks the first quarter of the Australian financial year as well as the peak shipping season in Brazil, and with weather disruptions easing, miners may concentrate on delivering outstanding volumes towards the quarter end. In addition, with the domestic market heading into an extended holiday from late September through early October, most mills are expected to release pre-holiday restocking demand during September to keep production running through the break. Taken together, September looks set to be a month of stronger arrivals, pointing to a month-on-month increase in iron ore imports.