Limited arrivals, improved demand extended decline in iron ore port stocks

SHANGHAI, Nov 15 (SMM) – Inventories of iron ore across Chinese ports fell this week for a third straight week, as arrivals shrank and as demand improved after prices of futures rallied.

SMM data showed that iron ore stocks across 35 Chinese ports decreased by 2.05 million mt from a week ago to 114.4 million mt as of November 15, 16.86 million mt lower than a year ago.

Arrivals of seaborne iron ore at Chinese ports have fallen for two consecutive weeks, according to SMM estimates.

Meanwhile, climbing prices of futures prompted some steel mills to step up purchases in the physical market, as they tended to buy the rise. Iron ore prices on the Dalian Commodity Exchange rose for a fourth day in a row to a three-week high of 633 yuan/mt overnight.

This week, iron ore deliveries from the 35 Chinese ports averaged 2.87 million mt per day, up 126,000 mt from the prior week and 237,000 mt from the same period last year, showed SMM data.

The daily average iron ore deliveries are unlikely to continue to increase next week, as steel mills will become more cautious about procurement after the major steelmaking hub of Handan in Hebei province and the Henan province activated smog alerts.