China iron ore demand to grow in 2015 in part due to lower prices

BEIJING – A report released by the China Metallurgical Industry Planning and Research Institute says China’s iron ore imports are predicted to grow on-year by 6.4% to around 1 billion metric tonnes next year, driven by lower commodity prices and growth in domestic demand. The report also points out, however, that the growth rate is significantly lower than 2014’s estimated 14.7% on-year increase, due to declining GDP and other downward pressures on China’s economy.

Despite structural changes and a decline in the economy, domestic steel output and demand are both expected to grow in 2015, leading to higher ore imports. Another incentive for rising imports, according to representatives at the China Iron and Steel Association, is falling prices for iron ore: Deputy Secretary-General of the association Li Xinchuang said iron ore prices will stay low next year at around US$70-80 per metric tonne, but are unlikely to fall below US$60 a tonne.

As for domestic demand, Beijing-based Lange Steel Information Research Center released a report saying steel demand in China will reach 720 million tonnes in 2015. www.webershandwick.cn  (ATI).