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Growth of Iron Ore Imports Slows down
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The growth of China's iron ore imports registered significant gains in the first half of the year but the rate of growth has decelerate due to an increase in investment in domestic mines, international price hikes and the supply of ore in the country.

Vice President Luo Bingsheng of the China Steel and Iron Industry Association told a recent forum in Changsha, capital of central China's Hunan Province that in the first quarter of this year, China's iron ore imports grew 27.73 percent from the same period last year, while in the second quarter the rate dropped to 18.45 percent. In July, iron ore imports rose only 14.56 percent.

Significant hikes in international iron ore prices have forced China to increase its investment in domestic iron mines, he said.

Between January and July this year, China's investment in iron mines jumped 71.4 percent to 20.061 billion yuan (US$2.5 billion), association statistics show.

China's iron ore production in 2005 reached 420.49 million tons, up 93.77 percent from 2001. Its iron ore output is likely to exceed 500 million tons this year, according to the association.

The increase in the domestic supply has pushed the price of China-produced ore lower than that of imported ores. Figures show during the May-July period this year, the price of China-mined iron ore averaged 558.51 yuan per ton, 2.78 percent lower than the price of imported ore.

Some experts, however, predict that China's dependence on imported iron ore would continue to increase in the long run due to limited iron ore reserves of the country.

Yan Qiping, secretary of an association of scrap iron and steel in China, expects China's yearly imports of iron ore to reach 540 million tons in 2010, with imports rising from the current 52.5 percent to 62.9 percent of the total ore.

(Xinhua News Agency September 18, 2006)

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