Peaking Pig Iron Output Led to Continuous Iron Ore Destocking at Ports, Inventory Declines to Continue due to Low Inventories at Steel Mills

Iron ore inventories across 35 ports tracked by SMM totalled 125.77 million mt as of April 14, down 2.1 million mt from a week earlier, and down 14.32 million mt on the year. As of now, the inventory has dropped for seven consecutive weeks.

The daily average shipments from the 35 ports decreased 49,000 mt on a weekly basis to 3.09 million mt last week, and remain at a high level. The arrival volume this week decreased significantly by 22.09% from the prior week.

The output of pig iron at steel mills continued to rise, resulting in further increase in raw material consumption. However, some steel mills experienced a small loss in profits, and the enthusiasm for taking delivery from ports has declined.

The overseas hurricane will still affect the supply of iron ore for one to two weeks, and the arrivals are unlikely to improve in the short term; the output of pig iron remains high, but is likely to have peaked due to the recent maintenance at a growing number of blast furnaces.

It is expected that the inventory decline across the 35 ports will gradually narrow.