Baosteel to increase iron ore purchases to 100 million tons per year

The largest steel producer in China, Baoshan Iron&Steel (Baosteel), announced that it plans to increase iron ore purchases to 100 million tons per year in the future. SteelOrbis informs about it.

Currently, the company’s annual purchase of this raw material is 80 million tons, the suppliers are mainly the four largest mining companies of the global market.

As the company noted, in April-June 2023, the production of Baosteel pig iron was at a relatively high level. This led to more demand for the iron ore, which somewhat supported commodity prices in April and May when the market slowed.

In May, Baosteel predicted that the volume of steel smelting in the country in the current year will not change, but will be slightly lower than in 2022. The comments regarding production expectations were made after the publication of the company’s results for the first quarter of 2023. Chinese steelmakers had been waiting for official confirmation that Beijing would continue a course to curb steel output that began in 2021 to meet carbon-cutting targets.

The company also expects that Chinese exports of rolled steel will continue to grow amid a decrease in demand for steel in the domestic market. This process will be gradual and slow, and will depend on the balance between domestic and foreign markets over a period of time.

As GMK Center reported earlier, the most traded September iron ore futures on the Dalian Commodity Exchange, June 30 – July 6, 2023, decreased by 1.05% compared to the previous week – to $112.16/t. On the Singapore Exchange, quotes for basic August futures as of July 6 decreased by 2.4% compared to the price a week earlier – to $108.1/t. Iron ore prices fall on steel production curbs in Tangshan.