Imported iron ore stocks at 35 Chinese ports decline, driven by strong rigid demand

Imported iron ore stocks at 35 Chinese ports totaled 109.85 million mt as of November 17, down 900,000 mt WoW and 21.69 million mt YoY. Daily average pick-ups from these ports added 29,000 mt WoW to 2.92 million mt in the week ending November 17. Weekly port arrivals fell a little. SMM data showed the daily average pig iron output of sample steel mills rose 21,900 mt WoW to 2.2 million mt, driving steel mills to pick up more ore from ports. Moreover, improved profit margins also boosted purchases. As port activity in north China may decline with cold winter weather, steel mills stocked up in advance.

Overseas shipments will be ample, but the share to China may be average. Rigid demand from steel mills will remain strong, given profit margin recovery and low raw material stocks. As such, port stocks may see limited changes.