Iron ore prices edged higher last week thanks to a near 1% rise on Friday despite news of the record fall in Chinese economic growth in the March quarter.
The price of 62% Fe fines delivered to northern China rose 80 cents on Friday to$US86.17 a tonne, up from $US85.60 the previous Thursday before the Easter break.
China’s GDP fell at an annual rate of 6.2% in the first quarter from the 6% rate in the final three months of 2019.
The small rise in iron ore prices was more due to the better than expected crude steel production figures for March and the first quarter.
China’s National Bureau of Statistics said the country’s crude steel output fell 1.7% to 78.98 million tonnes of crude steel last month, down from 80.33 million tonnes in March 2019 and 74.8 million in February. It was up on the 75.7 million tonnes produced in January.
In the first quarter of the year, China produced 234.45 million tonnes of crude steel, up 1.2% from first quarter of 2019. Output in January and February this year was combined and was up 3.1% on the first two months of last year.
The average daily output in March eased to 2.55 million tonnes, compared with 2.58 million tonnes in the first two months of this year, hitting the lowest daily average since January-February 2019, according to Reuters.
Earlier in the week, China’s March trade data revealed a solid set of import numbers for iron ore.
China’s iron ore imports dipped by just 1.3% in March to a still-high 85.91 million tonnes according to China’s General Administration of Customs.
That was down 0.6% from 86.42 million tonnes a year earlier, and compared with 176.8 million tonnes over the first two months of 2020.
For the first quarter this year, imports were up 1.3% at 262.7 million tonnes of iron ore from 259.3 million tonnes in the same period a year earlier.
Friday also saw Rio Tinto report a solid rise in first-quarter iron ore exports to 72.9 million tonnes, up from 69.1 million tonnes a year earlier.
Rio Tinto said the result was dragged down by disruption caused by the destructive Tropical Cyclone Damien in February, one of the strongest systems to pass the Pilbara coastline in years.
But it was down sharply – 16% – from the December quarter.
The March, 2019 quarter was impacted by Cyclone Veronica which hit Rio’s operations in late March) while fires at the export terminals at Cape Lambert also cut shipments.
And figures from Brazil last week helped explain some of the firmness in global iron ore markets so far this year.
Vale’s exports are down on a year ago, despite the March 2019 quarter being hit by the January 25 mine dam wall disaster that saw around 90 million tonnes of exports was taken off the market.
First-quarter iron ore exports similarly fell 17% compared with a year ago to 70.3 million tonnes, according to the Brazilian mining group, Ibram.
Iron ore exports fell to 22.3 million tonnes in March alone, a 7 year low for a single month. March exports were down 6.74 million tonnes or 23.3% from February.
That helped power a 17% fall in all mining output with the blame placed on heavy rains and the impact of the global response to the COVID-19 pandemic,
Total mine output reached 220.44 million tonnes in the January-March period, Ibram said on Wednesday, April 15, compared with 265.45 million tonnes in the first quarter and 267.76 million tonnes in the fourth quarter of 2019.
