Reuters reported that China China’s iron ore imports fell for a second month by 3.6% to 74.57 million tonnes, as a sharp drop in prices encouraged buyers in the world’s top consumer of the steelmaking raw material to hold off on orders.

Spot iron ore prices slumped 13% in May, the biggest monthly fall in a year, and raised expectations of even lower prices. The drop in bookings has been mainly reflected in June’s shipment. Total imports for the H1 of the year reached a record 460 million tonnes up 19.1% YoY.

A Qingdao based iron ore trader said that Quite a lot of companies were burnt by the drop in prices and have stopped fresh imports. I think July shipments may recover because of bargain hunting by steel mills and other big trading houses.

According to CISA data, China’s biggest steel mills raised output to record levels in the middle of June despite concerns that output growth was continuing to outstrip demand.

CISA estimated that 97.2% of additional crude steel production in the first five months of 2014 was absorbed by the overseas market. Chinese imports of soyabeans rose 7.0% in June from May as Chinese crushers keep robust imports from South America, despite negative crushing margins.