As expected, domestic output of iron ore concentrates among the 332 Chinese mining enterprises Mysteel tracks climbed during the first nine months of this year, rising by 13.3 million tonnes or 7.1% on year to reach 199.7 million tonnes, according to Mysteel’s monthly survey released on October 16. The high margins miners were earning on concentrates encouraged them to continue lifting production, respondents said.
The 332 miners account for around 90% of China’s iron ore concentrates capacity, and together, they produced 22.7 million tonnes of concentrates last month, up by 6.5% from September last year but down by 4.7% on month. The dip from August was blamed on the temporary ban on the use of explosives for mining last month and the suspension of production at many mines during the National Day holiday week over October 1-7, Mysteel Global learned.
“We’d expected that production would be disrupted to some degree in September, as mining operations are restricted every year during major events such as the ‘Two Sessions’ political meetings in March and the National Day holiday in October,” one survey respondent said.
“Moreover, the extent of the decline in output last month also within our anticipation because many mining companies undertook facilities maintenance during the restriction period,” he added. Officials of two miners in Shandong province (in East China) and Tangshan (in North China’s Hebei province) confirmed they had overhauled all equipment during the suspension beginning around September 24.
Meanwhile, the on-year rise in concs production among Mysteel’s sampled miners over January-September perfectly aligns with an observation made at last month’s international steel and raw materials conference in Qingdao by Lei Pingxi, chief engineer of Metallurgical Mines’ Association of China. “Domestic iron ore output has increased 7% on year so far this year,” Lei told delegates, as Mysteel reported.
Going forward, domestic mining companies are expected to keep lifting their concentrates production, given that they’re still earning high profits from them, Mysteel Global understands.
The total profits of large- and medium-sized Chinese iron ore miners during this year’s first eight months leapt by an eye-watering 401% on year to Yuan 10.1 billion ($1.4 billion), according to metallurgical mines association data.
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