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Your article sounds good-steel production has actually risen 1% yoy as per last article I saw on that and most say China still growing 7.6%-problem(besides possible effects of new iron derivative markets)as per article recently posted was supply grew even faster so BHp and Rio reportedly cut back.
the line I bolded refers to China's average of only 20% iron content for its ore as I've been quoting from other sources also,w some iron mines in China as low as 4% (TV doc quoting Brazilian mining magnates) which is why some Chinese iron producers have a high cost as reported by agmetalminer 12-13-10 and a recent article by Kubi on ihub and thus as i kept saying some of those higher priced china iron producers may cut back as article would indicate.
"Spot prices of key steel-making ingredient iron ore have been forecast to gain as much as 39 per cent in the fourth quarter of the year, spurred by a possible renewed buying spree from China and reversing the fall in demand in the last two
Based on data from China 's National Bureau of Statistics, the country's iron ore production declined to 115.5 million metric tonnes in July, down by 8.1 per, which according to Bloomberg calculations was its biggest drop since 2008.
Current low prices of iron ore in the global market has been seen to likewise propel China's buying spree.
As of Aug. 21, the 62 per cent iron ore content arriving at China's Tianjin port dove to a low $106.40 per tonne.
" We're using almost all imported ore to feed our furnaces now as prices have become more appealing," Wang Liancheng, an international trading manager, told Bloomberg News.
Chinese traders likewise need to build on stocks in anticipation of the freezing weather disruptions in the winter months.
But with this frenzy to deplete stocks comes the possibility of iron ore prices jumping as early as next month, and could trade to as high as $148 per tonne in the fourth quarter.
Chinese iron ore consumers prefer to import the raw commodity rather than mine it since extracting it is way more expensive, what with only a 20 per cent iron content compared with the more than 55 per cent iron found in Australia n ore.
However, although China's steel industry will continue to churn, this is still no guarantee that prices of iron ore will rally for a long time
