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Iron Ore August 08, 2016 09:30:13 AM

Chinese Iron Ore imports surge to 7-month high; Prices hit highest level in 3 months

Anil Mathews
ScrapMonster Author
The monthly imports totaled 88.4 million tonnes in July ’16, 8.3% higher from the previous month.

Chinese Iron Ore imports surge to 7-month high; Prices hit highest level in 3 months

BEIJING (Scrap Monster): The latest statistics released by the Chinese customs authorities indicate that the country’s iron ore imports surged higher during the month of July this year, on the back of robust demand from the steelmaking industry.

The monthly imports totaled 88.4 million tonnes in July ’16, 8.3% higher from the previous month. The imports by the country touched the highest level since December last year. According to the General Administration of Customs, the iron ore imports during July this year were up 2.7% over the previous year. The cumulative imports during the initial seven-month period in 2016 totaled 582.05 million tonnes, significantly higher by 8.1% when matched with the corresponding period last year. The imports of iron ore during January to July last year had totaled 538.44 million tonnes. A large portion of those imports came from Port Hedland in Australia.

The steel prices have rallied by almost 30% since May. This has led to increased steel production by Chinese mills despite high inventory levels. The ramp up in steel production has led to rise in imports of the steel making raw material. The imports are expected to stay around these levels in the forthcoming months, according to analysts.

Meantime, iron ore prices broke the $60 per tonne level, edging higher by 3.4% on Monday. The prices hit a three-month high. The Dalian iron ore hit the highest level in two years, backed by firm steel strength.

The monthly export data released by the Australian Port of Hedland authorities indicate that iron ore exports declined during the month of July this year. The total shipments fell nearly 7.4% when matched with the previous month. The iron ore shipments to China were up down 5.8% during the month.

According to port data, iron ore shipments totaled 38.723 million metric tons during July 2016, 7.4% down when compared with the exports of 41.82 million metric tons recorded during June this year. However, the exports were higher by 9.7% when matched with 35.30 million metric tons of export during the same month a year earlier. The cumulative iron ore shipments during the initial seven-month period of the year recorded fresh highs of 457.5 million tonnes.

The iron ore shipments to China dropped by 5.8% during the month. The exports totaled 32.517 million metric tons during July this year, as compared with the exports of 34.513 million metric tons during June.

Port Hedland is the world’s biggest bulk-export terminal which handles cargoes from miners including BHP Billiton and entrant Roy Hill Holdings. The port is located in Australia's remote northwest Pilbara region, which supplies more than half of the entire world's iron ore traded by sea.

Meantime, Ore Asia Mining and Development Corp, the lone iron ore miner in Philippines, has suspended operations, after an audit by government agency revealed that the mine’s operation leads to pollution of river. The ore transport permits were withdrawn and the company was ordered to stop the whole operation. The company had produced 40,000 tonnes of iron ore in 2015.

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