Through Jul-Aug, output came at low-70’sMt/month, down 16.4% YoY, more than the 8.3% YoY decline recorded at Chinese blast-furnaces. Nevertheless, due to its low iron content, the slow-down at Chinese mines is thought to have matched only 50%-75% of the lower consumption at the steel mills.
Should iron prices CFR China stay well under 100$ in upcoming weeks, mining in China is expected to decline even faster due to negative margins. A quick recovery of steel & iron sector on China’s recent economic stimulus plan seems unlikely since the plan focus on a financial sector struggling with expensive/non-performing loans and CISA keeps encouraging its members to wind down steel output.
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