China imports record amount of iron ore

China’s December iron ore imports surged 17 per cent from the previous month to a record 96.27 million tonnes, customs data showed on Wednesday, as global miners increased output and shipments to the world’s top consumer.

Full-year shipments rose 2.2 per cent to 952.72 million tonnes, according to data from the General Administration of Customs.

But global miners can expect a decline in demand this year as China’s steel sector further curbs output, hit hard by a slowing domestic economy, tighter credit and government measures to curb pollution.

“Iron ore imports could fall slightly, as steel production in China will drop, while traders will also be reluctant to import iron ore due to the bearish outlook on iron ore prices,” said Wang Yilin, an analyst at Sinosteel Futures in Beijing.

China’s crude steel output is expected to decline for a second straight year in 2016 on continued weakness in demand, after production fell 3.1 per cent to 781 million tonnes last year, according to a government study.

This would lead to a drop in consumption of the steel-making raw material iron ore of 4.2 per cent to 1.07 billion tonnes, the Metallurgical Industry Planning and Research Institute said in early December.

Spot iron ore prices tumbled 40 per cent last year, the third straight annual fall, making it one of the worst-performing commodities.

China’s steel exports jumped 10.9 per cent to 10.66 million tonnes in December from the previous month, data showed.

It was the third time for shipments to exceed 10 million tonnes. Full-year exports surged 19.9 per cent to a record 112.4 million tonnes.