China's iron ore demand to be limited by policy
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Update time : 2022-04-25 21:06:47
Most of China’s bulk commodities' prices have grown from the begging of this year. In addition, iron ores price has increased from last November as well.
There were two reasons to explain the increasing prices of iron ores. First, steel mills kept replenishing stocks. Second, the trade of steel in China become more popular, and it makes steel mills raise their production to obtain more profit. As a result, increasing production led to high demands for iron ores.
However, the current steel mills are not willing to increase production because profit is not high enough. The iron ores supply from other countries increases, and it might impact domestic iron ores. In addition, China’s National Development and Reform Commission (NDRC) announced to continue cutting crude steel production this year, which might make iron ore demands decrease at the same time.
The global bulk commodities will constantly stay high level due to shortages of supply. However, in terms of iron ores, because of restrictions on carbon emissions and carbon intensity in China, low production of crude steel might make iron ore price decrease.
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