Posted on 09 Sep 2021
China's iron ore imports over January-August dipped 1.7% on year to reach around 746.5 million tonnes, with the pace of the decline being slightly faster than the 1.5% on-year drop recorded for the first seven months, according to the latest statistics from the country's General Administration (GACC) of Customs on September 7.
During August alone, total imports decreased by 2.9% on year to 97.49 million tonnes, Mysteel Global calculated based on the GACC’s official data. However, the volume had reversed up by 10.2% from July after declining for the previous four months.
Mysteel’s weekly survey also identified the same trend, with ore deliveries to the 45 Chinese ports regularly sampled reaching around 98.6 million tonnes over the four weeks during August 2-29, up by 14.5% from the volume over the previous four weeks spanning July 5-August 1.
The lift in iron ore imports had led to more stocks accumulating at many Chinese ports, which – together with disruptions to operations at some ports caused by COVID monitoring and adverse weather – led to rather serious bulk carrier congestion in August, especially in the first half month.
Other Mysteel data showed that 199 vessels were queuing at the 45 ports for unloading over August 6-12, the longest queue since January 29. Though the congestion has generally eased now, as of September 2, there were still some 173 iron ore vessels queuing at these ports, still a high level.
Regarding iron ore demand in August, that from domestic steelmakers declined last month amid the central government’s push to lower the nation’s steel output on year for 2021. Many provinces, especially major steelmaking hubs such as Hebei, Jiangsu, and Shandong, have pressed local steelmakers to trim their production since late July and August, as reported.
Blast furnace capacity utilization among the 247 Chinese steel mills under Mysteel’s survey stayed at 85.45% over August 27-September 2, much lower than the over 90% for May-June, and 9.07 percentage points lower than the corresponding period in 2020.
Consequently, as of July 29, the stocks of imported iron ore at the 45 ports had climbed to around 131 million tonnes, the highest since April 23, according to Mysteel’s data.
With the rather bearish market outlook suggesting higher ore supplies and shrinking demand, iron ore prices experienced great turbulence last month, with Mysteel SEADEX 62% Fe Australian fines slumping to as low as $129.25/dmt CFR Qingdao on August 19, as against $180.2/dmt on July 30. The index then recovered to $151.55/dmt by August 31 but was still down $28.65/dmt from July 30.
Source:Mysteel Global
