As Chinese steelmakers begin to refurbish their dwindling stockpiles the prices of iron ore are set to rise again. China saw iron ore imports increase by 6.8% in the month of July as the seasonal demand for raw material was considered.
Imports of iron ore rose to 54.55 million metric tons in July as compared to 51.09 million tons in the previous month of June. The data from the General Administration of Customs in China was analyzed by Bloomberg which said that the figure was 6.4 % greater than the 51.28 million tons of iron ore that were imported in 2010 July.
Xu Guangjian said that there were more auctions of iron ore from Brazil and Australia in July as people were preparing for the traditional peak season starting from September. Production is pushed up in September and October as power restrictions are eased out in China.
Exports of steel products rose 3.5% to 4.44 million tons for the month of July as compared to the 4.29 million tons in the month of June. The production of steel fell by 1% in China in the month of July to 59.3 million tons.
This was influenced by power shortages as per data that the National Statistics Bureau released. Graeme Train, steel analyst with Macquarie in Shanghai said that the Chinese are always trying to get hold of any material they can and this July figure reflects that there is more available. Train added that regular construction activity was also performing very well regardless of what's happening with social housing.