Mining and Heavy Industries

Bursting stockpiles hit iron ore price

Iron ore stockpiles at Port Hedland. Photo: BHP Billiton

Reports indicate Chinese iron ore imports have slumped to six-month lows, as stockpiles at ports hit record levels.

Iron ore imports were down 2.3% year-on-year to 82.23 million tonnes in April, according to trade figures from China’s Customs Bureau.

Inventories at Chinese ports and steel mills are at or near all-time highs, according to multiple sources, with port stockpiles said to be 33% higher than they were a year ago.

The news comes as iron ore dips to close to US$60 a tonne this week, down from a peak of almost US$100 at the end of 2016.

A note from ANZ analyst Betty Wang, quoted by the AFR this week, gave a soft short-term outlook for the commodity.

“Commodity prices, China’s iron ore inventory pile-up and credit tightening may weigh on China’s import outlook in the near term,” Wang was quoted as saying.

“China’s iron ore inventory appears to have peaked of late, which is likely to affect the country’s commodity imports in the near term.”

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