Higher raw material prices suppressed shipments from the ports, and production limitations in Hebei led to inventory build-up across 35 ports again

As of July 21, iron ore inventories across 35 ports tracked by SMM totaled 122.04million mt, up 670,000 mt from a week ago and 9.35 million mt from a year ago. The daily average imported ore shipments from the 35 ports decreased 31,000 mt on a weekly basis to 3.021 million mt last week. According to the port data tracked by SMM, arrivals at Chinese ports declined this week. Maintenance of BFs steel mills increased this week, but the profits of steel mills were average. Market trading sentiment waned off, with limited speculative demand.

In addition, news of production restrictions resurfaced this week, limiting production of BFs and sinter units at a modest level in some parts of Hebei province. Steel mills took a wait-and-see approach. It is expected that shipments from ports will weaken in a near future.

With a possible drop in arrivals at ports against cooling market sentiment, inventory at 35 ports may continue to pick up next week.