The iron ore stock, which reached 120 million tons at the beginning of May 2023, dropped to 110 million tons in October. However, starting from May 2024, these stocks began to gradually increase and reached over 140 million tons.
According to analysis, these changes in iron ore stock indicate a decrease in steel production enterprises and market demand. In mid-March, stocks of steel companies reached 19.53 million tons, reaching the highest level in the last four years. This creates a boost for iron ore supply in the steel supply chain.
Iron ore stocks accumulated in ports indicate that the activity levels of steel production enterprises have decreased. While China's crude steel production was 261.52 million tons in the January-March 2023 period, it decreased by 1.9% annually to 256.551 million tons in the same period in 2024. Apparent steel consumption also decreased in the same period.
Analysts state that this decrease in steel consumption indicates a long-term transformation process. In particular, the weak market demand for construction materials and the slowdown in production are affecting construction steel production. This leads to an increase in private ore port stocks and price fluctuations in the iron ore market.
Steel companies are looking for solutions to alleviate the cost pressure caused by these fluctuations in iron ore prices. However, there are difficulties in controlling the international iron ore supply chain. This situation leaves steel producers facing uncertainty and increases imbalances in the market.
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