The iron ore market has had a good year thanks to the Chinese

Global seaborne iron ore imports are set to reach a record high in 2024, rising by 3.6%, but this increase was almost entirely driven by purchases from China, the world’s largest buyer of this key steelmaking raw material. As a result, global seaborne iron ore imports in 2024 are expected to total 1.707 billion tonnes, 60 million tonnes more than the 1.647 billion tonnes in 2023. Of this 60 million tonne increase, 59.1 million tonnes is attributed to China, as its seaborne imports rose by 4.9% to 1.274 billion tonnes. This means that China’s seaborne iron ore imports will reach a record high in 2024, a fact that seems somewhat inconsistent with the potential decline in steel production.

Official data shows that crude steel production in the first 11 months of 2024 was 929.19 million tonnes, a 2.7% decrease compared to the same period in 2023. Since December is likely to be a quiet month for steel production due to the winter shutdown and reduced seasonal demand, it is probable that full-year production in 2024 will be lower than in 2023. Nevertheless, China’s steel production in 2024 is expected to reach around 1 billion tonnes, marking the sixth consecutive year of production at this level. Given that China’s steel production has effectively remained stable since 2019, the question arises as to why iron ore imports have increased in 2024. There is likely some replacement of lower-quality domestic production, but the main driver is likely the lower price trend throughout the year and the rebuilding of inventory.