- Domestic iron ore concentrate output seen missing 2025 target
- Falling prices, strict mining governance emerge as roadblocks
Mysteel Global: Chinese mining companies should move faster to advance key iron ore projects, the China Iron and Steel Association (CISA) told delegates attending its forum in Beijing last Friday. The call came as domestic production of iron ore concentrate this year is seen falling well short of a target CISA had set three years ago.
“CISA will closely monitor the progress of key projects and strengthen efforts to maintain stable mining operations, step up supply-side structural reform in the steel industry, and ensure adequate supplies of steelmaking raw materials,” CISA’s vice president Xia Nong pledged to delegates.
Participants had shared their concerns regarding various challenges arising from progressing iron ore projects, such as land-use approval procedures, mining permit issuing efficiency, mining rights renewal, and policies related to processing low-grade ore, according to a Monday post on CISA’s official Wechat account.
Government officials highlighted aspects of the newly revised Mineral Resources Law, which took effect in July this year, with one noting that while China remains heavily dependent on iron ore imports, it actually has a vast potential for expanding its own production. “It’s imperative to enhance domestic iron ore production capacity by accelerating the transition from exploration to active mining,” the official said.
The observation was significant. Back in March 2022, CISA had launched its ‘cornerstone’ plan, aiming to raise China’s self-sufficiency in steelmaking raw materials by boosting the country’s domestic iron ore concentrate output to 370 million tonnes (mnt)/year by 2025 — a substantial increase of 100 mnt/y from the 2020 level.
Although progress to achieve this target has been impressive — China’s iron ore concentrate production rose by a marked 11% from 2022 to reach 300 mnt last year, according to CISA’s earlier post — the goal to reach 370 million this year is likely to fall short, some market pundits suggest.
They cite weaker production willingness among domestic miners due to falling iron ore prices, while mining companies also flinch from expanding capacity when faced with stricter mining governance led by authorities, as they will have to spend more money to protect the environment.
Among the government agencies, industrial organisations and domestic mining companies gathered at the event to discuss the development of domestic iron ore resources were representatives from the Metallurgical Mines’ Association of China (MMAC), which provided an overview of the current situation of domestic mining operations and iron ore supply.
The latest data from MMAC show that China’s iron ore concentrate output during January-October this year declined by 3.6% y-o-y to approximately 230 mnt.
Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.
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