Iron ore prices edged higher last week thanks to a near 1% rise on Friday despite news of the record fall in Chinese economic growth in the March quarter.
The Price of 62% Fe Fines delivered to northern China increased 80 cents on Friday to $US86.17 a tonne, up from $US85.60 last Thursday before the Easter break.
China’s GDP fell at an annual rate of 6.2% in the first quarter from the 6% rate in the last three months of 2019.
The slight rise in iron ore prices was more as a result of the improved expected crude steel production figures for March and the first quarter.
China’s National Bureau of Statistics stated that the country’s crude steel output fell 1.7% to 78.98 million tonnes of crude steel last month, down from 80.33 million tonnes in March 2019 and 74.8 million in February. It was up on the 75.7 million tonnes produced in January.
China produced 234.45 million tonnes of crude steel in the first quarter of the year, up 1.2% from the first quarter of 2019. Output in January and February 2020 was combined and was up 3.1% in the first two months of last year.
According to Reuters, the average daily output In March eased to 2.55 million tonnes, compared with 2.58 million tonnes in the first two months of this year, hitting the lowest daily average since January-February 2019.
Earlier in the week, China’s March trade data showed a solid set of import numbers for iron ore.
According to China’s General Administration of Customs, China’s iron ore imports fell by only 1.3% in March to a still-high 85.91 million tonnes
That was down 0.6% from 86.42 million tonnes a year earlier and compared with 176.8 million tonnes over the first two months of 2020.
For the first quarter this year, imports were up 1.3% at 262.7 million tonnes of iron ore from 259.3 million tonnes in the same period a year earlier.
Rio Tinto reports a solid increase in first-quarter iron ore exports to 72.9 million tonnes on Friday, up from 69.1 million tonnes a year earlier.
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Rio Tinto said the result dropped as a result of the disruption caused by the destructive Tropical Cyclone Damien in February, one of the strongest systems to pass the Pilbara coastline in years.
But it was down sharply – 16% – from the December quarter.
The March 2019 quarter was impacted by Cyclone Veronica, which hit Rio’s operations in late March), while fires at the export terminals at Cape Lambert also cut shipments.
And figures from Brazil Last week helped explain some of the stability in global iron ore markets thus far this year.
Vale’s exports were down last year, despite the March 2019 quarter being hit by the January 25 mine dam wall crisis that saw around 90 million tonnes of exports removed from the market.
According to the Brazilian mining group, Ibram, First-quarter iron ore exports similarly fell 17% compared with a year ago to 70.3 million tonnes.
Iron ore exports dropped to 22.3 million tonnes in March alone, a 7 year low for a single month. March exports were down 6.74 million tonnes or 23.3% from February.
That helped power a 17% fall in all mining output with the blame placed on the impact of the global response to the COVID-19 pandemic and heavy rains.
Total mine output reached 220.44 million tonnes in the January-March period, Ibram stated on Wednesday, April 15, compared with 265.45 million tonnes in the first quarter and 267.76 million tonnes in the fourth quarter of 2019.