China reduced iron ore production by 13.1% m/m in April

In April 2023, the production of iron ore in China decreased by 13.1% compared to the previous month – to 75.1 million tons. SteelOrbis reports about it with the reference to data from the Chinese National Bureau of Statistics (NBS).

Compared to April 2022, in April 2023, the production of iron ore by Chinese mining companies increased by 0.7%.

In January-April 2023, iron ore production decreased by 8% compared to the same period in 2022 – to 314.38 million tons.

During April, iron ore prices followed a downward trend amid reduction in steel production by steel companies, which caused a drop in demand for raw materials. After a long reduction in production, from mid-May, steelmakers began to resume steel production, which to some extent increased the quotation of iron ore.

Imports to China increased by 8.6% y/y in January-April – up to 385 million tons. In April, China imported 90.44 million tons of iron ore, which is 5.1% more than in April 2022, and 9.8% less than in March 2023.

According to the latest Fitch forecasts, iron ore prices in 2023 will be at the level of $125/t. The forecast was upgraded from $110/t amid market optimism about the recovery of the Chinese economy. In the long term, the agency forecasts a decline in iron ore prices to $50/t by 2028 due to a slowdown in supply and demand growth.

As of May 12, 2023, September iron ore futures, which are the most traded on the Dalian Commodity Exchange, did not change their quotations and remained at the level of the previous week – about 697 yuan/t ($100.84/t).

As GMK Center reported earlier, in 2022, China reduced production of iron ore by 1% compared to 2021 – to 967.9 million tons. In December 2022, iron ore production decreased by 1.2% m/m and increased by 2.4% y/y – up to 78.6 million tons.