The world’s top steel producer, China, bought 44.8 million tons of iron ore from India last year, according to customs data. The 88 percent increase comes as Beijing diversifies from traditional suppliers like Australia.
Shipments from India were the highest in nine years, statistics showed. Australia and Brazil remained China’s top suppliers in 2020. Australian shipments rose seven percent to 713 million tons, while Brazilian supplies were up 3.5 percent at 235.7 million tons.
“The two countries’ rise could not fully meet China’s demand,” said Tang Chuanlin, an analyst with Citic Securities, as quoted by the South China Morning Post. “Mills had to buy from other countries,” he added.
China relies heavily on imported iron ore to fulfil more than two-thirds of its steel mills demand, which was boosted by Beijing’s stimulus for infrastructure. The country has churned out a record 1.05 billion tons of crude steel in 2020.
According to Tang, last year Chinese steel firms were using more low-grade ore, like India’s, in an attempt to lower costs.
India’s Federation of Mineral Industries said it expected that purchases from China “will continue until March on strong demand,” but added it was too difficult to predict demand beyond then.
Spot prices of iron ore with 62 percent iron content for delivery to China soared 73 percent in 2020, while 58 percent iron ore skyrocketed 91 percent, according to SteelHome consultancy.
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