Iron Ore Destocking in Chinese Ports: Impact on Prices and Capesize Rates

Challenging seasonality, iron ore destocking at Chinese ports keeps going and inventories have reached distressed levels supporting iron ore prices & Capesize rates!

China Iron Ore destocking impact on capesize rates

Despite poor construction sector leading to a morose steel industry, iron ore imports and blast-furnace activity in China have remained record-high! Indeed, whilst recent steel prices have kept steel margins in China thin, favouring large-scale blast-furnaces over smaller electric-arc furnaces, recent iron ore prices have not averaged high enough (avg. ~110$/t basis 62%-Fe, excl. VAT) to sustain local iron ore mining economics… Hence current destocking & healthy imports!

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