Can domestic iron ore ease China's reliance on imported ore in the future?

More domestic iron ore could replace imported cargoes if supported by Chinese government policies in the long term, market participants told Fastmarkets, particularly when overall demand for iron ore stabilizes following steady steel output.

China aims to increase 100 million tonnes of domestic iron ore concentrates to about 370 million tonnes in the 2021-2025 period, China’s Iron Ore and Steel Association said in a speech on November 12.

Alternative products in physical market Most domestic iron ore concentrates are used as pelletizing feed, although some can work as sintering fines. Mills typically assess available resources and price differentials with imported cargoes to set the most appropriate iron ore blends, sources told Fastmarkets. Domestic concentrate with 65% or 66% Fe content is akin to Ukrainian low-alumina and high-silica concentrate as pellet feed; some steel mills show buying interest when its price is competitive against imported concentrate, a trader source in Shanghai said. “But domestic concentrate prices usually increase in the fourth quarter of the year due to low output in cold weather...


Alice Li

November 23, 2021

13:08 GMT