China cut iron ore output by 5% y/y in March

Iron ore production in China in March 2023 decreased by 5% compared to March 2022 – to 86.4 million tons. SteelMint reports about it with the reference to data from the National Bureau of Statistics of China (NBS).

In January-March 2023, iron ore mining remained at the same period in 2022 – 243.26 million tons.

At the same time, iron ore import to China increased by 9.8% y/y in the first quarter – up to 294.33 million tons. In March, China imported 100.23 million tons of iron ore, which is 10.6% more compared to February 2023 and 14.8% compared to March 2022.

Since early April, iron ore prices in China have been falling due to market fears that the Chinese government will impose restrictions on steel production at domestic smelters, weak domestic demand for steel during the peak construction season and a weakening global economic outlook.

According to Fitch’s latest forecasts, iron ore prices in 2023 will be at the level of $125/t. The outlook was upgraded from $110/t amid market optimism for 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 GMK Center reported earlier, as of April 7, 2023, September iron ore futures, the most traded on the Dalian Commodity Exchange, fell by 12.4% compared to March 31 – to 796 yuan/t ($115.72/t).

Also, in 2022, China reduced production of iron ore by 1% compared to 2021 – to 967.9 mt. 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.