As we have reported earlier, China iron ore imports fall by 14% M-o-M in Jan’16. The world largest consumer of iron ore, has imported 82.1 MnT iron ore in Jan’16 against monthly highest at 96.2 MnT in Dec’15. China imports more than two third of seaborne iron ore.
The country imports majority of iron ore from Australia, Brazil and South Africa. Among total imports in Jan’16, Australia contributed 61%, Brazil 23% and South Africa contributed 4.3%.
Australia exported less quantity of iron ore in Jan’16 (50.1 MnT) compared to Dec’15 (i.e. 58 MnT) as the major exporting Port namely Port Hedland was surrounded by Cyclone Stan and operation were halted, resulting less supply of iron ore to China.
On the other hand, Brazil’s Samarco mine, jointly owned by BHP and Vale, has been shut down since Nov’15 as the dam bursted there.Due to some environmental disaster, supplies from Samarco region halted, leading to short supply of iron ore to China from Brazil.
On slower Chinese economic growth as well as increased supply from major miners including BHP Billiton, Rio Tinto and Vale, global iron ore prices collapsed since two years. Steel mills in China, typically curb production before Lunar New year holidays.
However, post Chinese holidays global iron ore prices revive somewhat to a level of USD 50/MT, CFR China as local miners didn’t resumed production, short supply of iron ore from Brazil and Australia followed by restocking of raw material by mills as this is high time for constructional activity. But, now prices are again on declining phase and reached to a level of USD 48/MT.
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