Brazil may gain iron ore share
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Update time : 2020-06-02 22:37:48
Chinese demand for iron ore, a key raw material for making steel, is on the rise -- and Brazil is expected to seize a bigger market share despite a slump in May shipments, Chinese experts said on Tuesday.
As a palpable sense of rising trade tension between China and Australia grips industry players, some are expected to switch to Brazilian and South African iron ore, industry experts said.
The world's second-largest economy is recovering from the impact of the COVID-19 pandemic, with a key focus on new-type infrastructure construction, and demand for steel keeps rising.
Iron ore stockpiles at 45 Chinese ports are near four-year lows, coupled with a surge in the price of iron ore futures, according to a Futures Daily report on Tuesday.
From April, the price for iron ore futures has risen by 43 percent, domestic news portal 21jingji.com reported on Tuesday. The September-dated futures on China's Dalian Commodity Exchange closed at 757 yuan ($106.6) per ton on Tuesday.
Although the Chinese government has so far taken no action to curb Australia's $63 billion iron ore exports to China, and Australian miners are reportedly ready to increase output, Chinese experts warned that the landscape could change within the year.
The current high price of iron ore will weigh heavily on Chinese steel mills if it persists, and they are "eagerly seeking to diversify their import sources", Wang Guoqing, research director at the Beijing Lange Steel Information Research Center, told the Global Times.
