China’s run-of-mine (ROM) iron ore production during January-May this year totaled 397.1 million tonnes, lower by 3.5% compared with the same period last year, according to the latest statistics from the country’s National Bureau of Statistics (NBS).
While earlier NBS figures showed a narrower decline of just 1% for the first four months, the accelerated contraction over the five-month period was mainly driven by last month’s sharp drop in output, Mysteel Global observes.
In May alone, China’s ROM iron ore production tumbled 13.5% on year to 74.2 million tonnes, with the volume also down by 8.7% from April, the official data show.
ROM iron ore
By region, ROM ore output in North China’s Hebei province – the country’s top iron ore-producing hub – plunged by 18.8% on year to 30.5 million tonnes in May, while Northeast China’s Liaoning province followed by producing 13.2 million tonnes, lower by 12.4% on year, the NBS data show.
The decline in iron ore output reflected increased maintenance stoppages at domestic mining operations, which in turn curbed concentrate production.
Mysteel’s survey showed that the total quantity of iron ore concs produced by the 433 domestic mining enterprises under its regular tracking during May amounted to approximately 22 million tonnes, lower by 8.8% compared with the same month last year and by 0.7% from April.
Despite the reduction in domestic concentrate supply, demand remained robust last month, as healthy profit margins encouraged steelmakers to maintain high production levels. This firm demand bolstered miners’ confidence in lifting their offering prices.
For instance, during May the average offering price of 66% Fe grade iron ore concs in Tangshan city, Hebei province, was assessed by Mysteel at Yuan 983/dmt ($145/dmt) including the 13% VAT, up by 1.3% on month and 5.6% on year.
Note: This article has been published in accordance with a collaboration between MySteel and BigMint.
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