China March Iron Ore Imports Up Sharply, April Imports to Grow, but Slightly

SHANGHAI, Apr. 11 (SMM) - According to latest data, China imported 64.55 million mt in March, up 14.4% MoM and up 2.7% YoY, slightly lower than January’s level. The daily average imports reached 2.08 million mt in March, up 3.34% MoM.

The data shows that total imports and daily average imports both were up significantly, and due mainly to the following reasons. First, imported iron ore prices tracked lower after the Chinese New Year holiday, leaving obvious price advantages over domestic iron ore. Therefore, domestic steel mills and traders were active in importing goods, especially for non mainstream goods. Second, operating rates at beneficiation plants were down sharply from late January to early February due to the holiday factor. After the holiday, production failed to improve significantly along with the convening of NPC and CPPCC sessions and sluggish iron ore market. The shortfall of domestic goods also encouraged domestic consumers to import goods. Third, some domestic steel mills and traders turned optimistic towards the market in March given positive policies and market fundamentals, also increasing imports.

For April imports, Steelease is optimistic towards the outlook, but any increment will be small due to the following two factors. First, imported ore continues to enjoy price advantages. Second, operating rates at domestic blast furnaces are high, at above 90%, and show no signs of declines, leaving overall demand strong. However, production at domestic beneficiation plants is growing, and this will also gain some market share, despite price advantages of imported ore.