Iron ore imports to China dip in 2018

China’s General Administration of Customs has reported that the import of iron ore into the country declined by 1 percent in 2018 from the prior year, according to a Reuters article. For the year, China’s iron ore imports were 1.06 billion metric tons.

The yearly decline was the first time in eight years that iron ore imports dropped from the prior year.

On a more upbeat note, the decline follows a record 1.08 billion metric tons of iron ore imported to China for 2017, and the 2018 import figure did top 1 billion metric tons for the third straight year.

The Reuters article says the decline was tied to a sharp decline in the profits of steel companies, which created a disincentive to increase steel production. China also expected to reduce iron ore consumption in 2019, as steel output declines amid waning demand in both domestic and global markets, the China Metallurgical Industry Planning and Research Institute has reported.

The decline in steel production also may affect China’s scrap-consuming and growing electric arc furnace sector, which could still see higher costs for both ferrous scrap and electricity, according to one steel analyst contacted by Reuters.