China’s Iron Ore Imports Surge as Steel Output Rises and Prices Crash

Steelmakers in China are exporting at record levels to make up for falling domestic demand. Outbound cargoes of steel products rose 11 percent to 10.66 million tons in December from the previous month, the second highest ever, according to customs data. For the full year, exports soared 20 percent to 112.4 million tons, an all-time high. China makes about half the world’s steel and buys more than two-thirds of seaborne iron ore.

China’s iron ore imports jumped to a record last month, a sign that overseas miners are winning a greater share of the market in the world’s biggest consumer. Steel exports jumped as the nation sells its glut overseas.

Inbound iron ore shipments climbed 17 percent to 96.27 million metric tons from a month earlier, according to customs data Wednesday. Full-year imports were 2.2 percent higher at 952.72 million tons, also an all-time high.

The figures signal that exporters including Rio Tinto Group and BHP Billiton Ltd. in Australia and Vale SA in Brazil are managing to increase market share in China even as steel output and demand contract amid an economic slowdown. Supply expansion by the top miners has boosted oversupply and hurt prices while forcing smaller rivals to close. The steel-making raw material tumbled last month to the lowest in at least six years as demand growth stalled.

China can get iron ore from Australia and Brazil so cheaply that there’s less need for domestic supplies. Domestic output fell 8 percent last year. The cheap iron ore and freight rates have allowed mills to keep producing steel and flood international markets.

Annual aluminum product exports and copper ore and concentrate imports were also at record highs. Shipments of aluminum products rose 9.8 percent to 4.76 million tons in 2015, while imports of copper ore and concentrate climbed 13 percent to 13.29 million tons, customs data show.