Environmental protection inspections VS beneficiation plant maintenance: Overall capacity utilisation rate of domestic iron ore mines slightly declined in October, and may continue to decrease in November

According to SMM calculations, the capacity utilisation rate of mines in October 2024 was 55.9%, down 0.1% MoM; the total production of iron ore concentrates in September was 20.859 million mt, up 656,000 mt MoM. The increase in concentrate production in the month was mainly due to one extra production day in the calendar month. Most mining areas saw a slight decline in capacity utilisation rate due to the following reasons:

1)Environmental protection inspections intensified during the month, hindering production at some mines and beneficiation plants. Additionally, mining licenses in certain areas expired, leading to a shortage of raw ore resources and a decline in concentrate production, such as in Hebei and Liaoning regions.

2)Steel demand was relatively weak in some areas, with most mines maintaining low production levels, such as in the Yunnan region.

3)In some areas, shipping difficulties led to inventory accumulation, prompting beneficiation plants to undergo maintenance to reduce inventory, resulting in a decline in concentrate production; for example, in the Anhui region.

Some mines and beneficiation plants indicated that they plan to ramp up production in Q4 under the current price conditions, with a slight increase in capacity utilisation rate in certain areas. Looking at November, considering a roof collapse accident at a mine in the Shandong region, production in the area is significantly affected. Coupled with increased safety and environmental protection inspections as year-end approaches, the overall capacity utilisation rate is expected to decline slightly.