China's 2017 iron ore imports hit record high, steel exports down

Date 1/12/2018 2:36:26 PM Source: Reuters

    SHANGHAI, Jan 12 (Reuters) - Chinese iron ore imports fell 11 percent in December from the previous month, but full-year shipments were at a record high, customs data showed on Friday, as the world's top consumer of the commodity bought more raw materials to ramp up steel output.

    Arrivals for December dropped to 84.14 million tonnes, down from 94.54 million tonnes in November, data from the General Administration of Customs showed. 

    Full-year shipments rose 5 percent to a record of 1.075 billion tonnes, exceeding 1 billion tonnes for a second year.

    Chinese steel mills have increased production on the back of a strong recovery in steel prices that has pushed profits to their highest in nearly two decades. 

    "The 5 percent annual increase is within our expectations,” said Wang Di, an analyst with CRU in Beijing. 

    "Big miners have expanded their production and shipments, while China's crackdown in the first half of the year on illegal furnaces that use scrap for production spurred demand for seaborne iron ore. Appetite for imported iron ore from Chinese steel mills remains strong," Wang said. 

    Demand for higher quality iron ore, imported mainly from Australia and Brazil, has also been driven by China's pollution crackdown, traders said.

    Chinese steel rebar futures SRBcv1 have nearly tripled from all-time lows touched in late 2015. Prices for the rebar contract surged 46 percent last year and nearly 75 percent in 2016. Chinese iron ore prices  DCIOcv1  in 2017 jumped 16 percent and more than quadrupled the year before that. 

    Iron ore import demand and steel output in 2018 are expected to be at 1.12 billion tonnes and 838 million tonnes respectively, the China Metallurgical Industry Planning and

Research Institute said last month. 

    Australia on Monday said it expects iron ore prices to average $51.50 a tonne this year, down 20 percent from 2017, because of rising global supply and moderating demand from top importer China as its steel sector shrinks. 



    Chinese steel exports rose to their highest in four months, up 6 percent to 5.67 million tonnes in December from November, the customs data showed. 

    However, the full-year exports tumbled 30.5 percent to 75.43 million tonnes from 2016, as strong domestic steel prices and high profit at home led to a drop in shipments abroad. 

    Steel imports hit 1.2 million tonnes in December, up from 1.14 million tonnes in the previous month. Total imports for the year held almost steady at 13.3 million tonnes. 


Edited by SHMET