On September 22nd at this year’s Dry Bulk Europe conference which was held in Amsterdam, the Managing Director of Commodore Research & Consultancy, Mr. Jeffrey Landsberg, gave a special conference presenation on the subject of Chinese iron ore imports. Mr. Landsberg is regular conference speaker and speaks often on China-related shipping issues, as Commodore Research & Consultancy and China National Shipping Service have a special partnership. Attendees of the conference learned a great deal about the China National Shipping Service and were able to gain addititional insight into Chinese iron ore imports and the significant growth still being seen this year.

Mr. Landsberg entitled his presentation: Chinese Iron Ore Imports. Normally the titles of Mr. Landsberg’s presentations are more complex, but Mr. Landsberg explained that this year there has been many misconceptions regarding seaborne iron ore trade and China, and Mr. Landsberg felt it necessarily to focus directly on Chinese iron ore import volumes. While overall Chinese growth has slowed this year, it still has remained at a very impressive level that is not being recognized by many global analysts and the western media. For example, the first eight months of this year have seen Chinese crude steel production total a record 546.8 million tons. This is 29.9 million tons (6%) more than was produced during the same period last year.

Chinese iron ore import growth has been even more impressive and has grown to a very robust level well above the record seen last year. Through the first eight months of this year, Chinese iron ore imports have totaled a record 614.8.8 million tons. This is 88.1 million tons (17%) more than was imported during the same period last year, and represents a very significant increase.

  

Sadly, many global analysts and the western media have chosen not to report on robust Chinese iron ore imports this year and instead publish many negative articles. These days, the western media at times publishes far too negative views on China and Mr. Landsberg felt it very important to set the record straight. Chinese steel production has been at a record level, which of course means Chinese iron ore consumption has been at a record level. This is a significant factor for the dry bulk shipping market, and it is very important for all analysts to stay aware at just how robust Chinese iron ore imports have been this year.

Mr. Landsberg went on to discuss that Australia and Brazil have been producing a much greater amount of iron ore this year, which has caused iron ore import prices to fall to very low levels. This has been very beneficial to Chinese steel mills, as steel mills are able to purchase imported iron ore cargoes this year at very cheap prices. This is terrific for China’s steel industry, and has helped Chinese steel mill profit margins improve significantly from the start of this year. China as whole benefits as well, as imported iron ore is very high quality and therefore is not a heavy polluter to the environment.

Mr. Landsberg ended the presenation stressing that Chinese iron ore imports this year have been at a very robust level that many in the western media are still unware of. During the fourth quarter of every year, Brazilian iron ore shipments are typically the largest and the final three months of this year are expected to see a very robust amount of Brazilian iron ore exported to China. This will be helpful to the capesize segment of the dry bulk market, and should allow capesize raes to ultimately find support.