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China's 2018 iron ore imports fall 1 pct, first annual drop since 2010

Reuters  |  BEIJING 

(Reuters) - China's 2018 imports fell by 1 percent from the previous year, the first annual decline since 2010, according to data from the on Monday.

Full-year imports fell to 1.064 billion tonnes in 2018 from an annual record of 1.075 billion tonnes in 2017, the data showed. The ore imports, though, still exceeded 1 billion tonnes for a third year running.

Arrivals for shipments in December rose to 86.65 million tonnes, up from 86.25 million tonnes in November, official customs data showed, a slightly different monthly import figure from what was calculated earlier by

The fall in iron ore purchases for 2018 came as a 70 percent plunge in profit margins since late October cut the incentive for steelmakers to ramp up output and restock raw materials.

is also expected to reduce iron ore consumption in 2019, as amid waning demand in both domestic and global markets, the Metallurgical Industry Planning and said last month.

"With lower profit margins this year, would increase consumption of lower-grade iron ore, while reducing demand for medium- and high-grade ore," said Wang Yilin, an at Futures.

Wang also said she expects to cut output from electric-arc furnaces but maintain steady operation of blast furnaces, which will provide firm supports for iron ore.

Electric-arc furnaces only use and to produce crude steel, but their costs could still be higher than blast furnaces that use coking coal and iron ore.

"China's supply side reforms have been digested in the past two years and profits for steelmaking will return to a reasonable range in 2019," Wang said.

Average profit margins for rebar production now hover around 300 yuan ($44.50) a tonne, while hot-rolled coil production is barely maintaining profit, according to data tracked by Jinrui Futures and Futures.

Steelmaking profit margins hit a peak of more than 1,500 yuan a tonne in late 2017.

($1 = 6.7464 yuan)

(Reporting by Muyu Xu and Dominique Patton; Editing by Christian Schmollinger and Tom Hogue)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, January 14 2019. 09:12 IST