China iron ore imports fall to 18-month low in April as Brazil shipments slide
China’s iron ore imports in April fell to the lowest level in 18 months as poor weather in Brazil, the country’s second-biggest supplier, disrupted shipments and some production by miner Vale SA was halted after a mine accident.
Arrivals of iron ore, a key steelmaking raw material, were 80.77 million tonnes last month, the lowest since October 2017, data from the General Administration of Customs showed on Wednesday. That compares to 86.42 million tonnes in March and 82.92 million tonnes in April 2018.
For the first four months of 2019, China imported 340.21 million tonnes of iron ore, customs data showed, down 3.7 percent from 353.32 million tonnes in the same period last year.
Vessel-tracking and port data compiled by Refinitiv show iron ore shipments from Brazil to China have been falling sharply since January in the wake of a tailing dam disaster that killed hundreds people.
Vale has closed 92.8 million tonnes of its 400 million tonne annual iron ore mining capacity and the closures are expected to persist into 2020. Operations were also disrupted by a major storm in northern Brazil, a key iron ore mining region, in late March.
Data from Brazil’s Trade Ministry showed last week that the country shipped 18.34 million tonnes of iron ore in April, down 17 percent from March and down 29 percent from the same period last year.
But analysts expect iron ore demand in China to fall in the coming months due to increased environmental measures in some major steelmaking cities.
The city government for Tangshan, China’s biggest steel producing city, last week issued a statement ordering mills to reduce operations in May by around 30 percent from 20 percent in April, which would affect approximately 120,000 tonnes of crude steel output and 200,000 tonnes of iron ore demand.
“However, as total steel output was much higher than last year, demand for iron ore would remain stronger than the same period last year, despite the production restrictions,” Zhao Yu, an analyst at Huatai Futures, said on Tuesday, prior to the data’s release.
Source: Reuters (Reporting by Muyu Xu and Dominique Patton; Editing by Kenneth Maxwell)