China Iron Ore Imports Slump, Steel Exports Slow

BEIJING, Feb 10 (Reuters) - China's iron ore imports fell 25 percent in January from the previous month, while a slowdown in exports of steel products put an end to a seven-month trend of rising net exports from China, the top steelmaking nation.

Imports of iron ore slipped to 46.62 million tonnes after reaching 62.16 million tonnes in December, the second-highest monthly volume ever, the country's General Administration of Customs said on Wednesday.

The January import total was the second-lowest monthly figure since January 2009 and was just fractionally higher than the 45.5 million tonnes imported in October, when China took a week-long national holiday.

Net exports of steel products decreased to 1.54 million tonnes, halting a rebound from a slump that turned into net imports in early 2009. January's imports of steel products fell to 1.35 million tonnes while exports fell to 2.89 million tonnes.

China's steel industry attracted record volumes of iron ore in 2009, mainly from Australia, Brazil and India. Customs did not issue a breakdown of the January figure, but detailed data will be available later in the month.

The slowdown in shipments coincided with an unexpectedly harsh winter that snarled up transport and caused sea ice to disrupt shipping at several major ports.

January also saw moves by the People's Bank of China to tighten monetary supply, a change of direction after a year of loose lending that immediately spooked commodity markets.

Traders have said China's iron and steel markets have begun slowing down as February's Lunar New Year holiday approaches.

During the month, Baosteel (600019.SS: Quote), whose pricing decisions normally set the tone for the industry as a whole, surprised the market when it decided to hold off on planned price rises for February -- but traders suggested the move was aimed at taking the heat out of the iron ore market before benchmark price negotiations with foreign miners begin.

The slowdown in iron ore shipments could be repeated this month because of the Lunar New Year holiday, which runs through next week.

Evidence of lower import demand could strengthen China's negotiating position as it tries to agree annual term prices for iron ore with the top suppliers, Vale (VALE5.SA: Quote), Rio Tinto (RIO.AX: Quote) and BHP Billiton (BHP.AX: Quote).