Shipments of Imported Iron ore from Chinese Ports Recovered to High Levels on Increasing Port Activity

SHANGHAI, Mar 8 (SMM) – The iron ore inventories across 35 ports in China tracked by SMM totalled 138.11 million mt as of February 24, up 4.47 million mt MoM, but down 15.13 million mt YoY.

The monthly average shipments of imported iron ore leaving ports added 674,000 mt to 3.07 million mt in February owing to the recovery of end-user demand.

First, there are signs of continuous recovery in end-user demand of the industrial chain, and the profits of steel mills have increased slightly, leaving low inventory at steel mills.

In addition, from a fundamental point of view, the amount of iron ore arriving at the ports increased month-on-month, and port activity has increased. The unloading efficiency has also accelerated. On the demand side, the output of pig iron at blast furnaces has slowly increased. But any growth of pig iron output will be limited in the near term in view of the much larger output growth compared to the same period of years before.

In the near term, steel mills are likely to keep inventories at low levels despite minor profits recently.

Iron ore shipments from domestic ports, which are still constrained by downstream demand and steel mills’ profits, will have limited room for growth.

In addition, the NPC and CPPCC in March may affect the trading of iron ore.

However, the tight supply is expected to result in a slowdown in the accumulation of inventory at 35 Chinese ports.