Iron ore is moved by a giant crane at a port in Meizhouwan of Quanzhou, Fujian province. [Photo/Xinhua]

Decline forecasted due to excessive global output and cheap scrap metal

The start of 2020 saw slumps in steel prices but fluctuations in imported iron ore prices at high levels, which industry experts said was a reflection of domestic market demand and supply, but was also shaped by non-market factors such as pricing mechanisms.

They also said high imported iron ore prices will not likely continue due to factors including excessive global output of the commodity and tumbling prices for scrap metal, an alternative that avoids the need for iron ore.

China imported 262.73 million metric tons of iron ore in the first quarter, up 1.3 percent year-on-year, at an average of $90.59 per ton, up 11.7 percent in terms of price, according to official data from the General Administration of Customs.

At the same time, average finished steel prices for the first quarter decreased 5.7 percent year-on-year, according to the China Iron and Steel Association.

Prices for imported iron ore kept increasing since early April after a slump at the end of March, before fluctuating in recent days.

The administration said imports of iron ore for March dropped 0.6 percent year-on-year to 85.91 million tons, with the average price falling to $89.76 per ton.

CISA's imported iron ore price index hit 333.77 on March 13 before sliding to 307.22 at the end of the month. It then gradually increased to 314.96 on April 20, before dropping again to 307.77 on April 21.