China's emergence as the world's leading iron-ore-consuming country

Abstract

China has become the leading iron ore consuming nation, and, based on recent steel production capacity increases and plans for more, its consumption will almost certainly to continue to grow. China's iron ore industry, however, faces a number of problems. China's iron ore is low-grade, expensive to process, and its mines are being depleted. For many Chinese steelmakers, particularly in the coastal regions, the delivered cost of domestic iron ore, is more than the delivered cost of foreign ore. Thus China's iron ore imports are expected to increase. As China's growth continues, it will almost certainly surpass Japan to become the leading iron ore importing country as well. Without China's increasing appetite for iron ore, the world iron ore market would be flat or declining. China's recent imports largely offset the slump in demand in North America and Europe. China is regarded by the iron ore industry as the growth sector for the next decade. Although Chinese imports are expected to continue their rapid increase and imports in other Asian countries are expected to continue growing, there appears to be enough greenfield and expansion projects to meet future demand for iron ore worldwide. Present suppliers of iron ore, Australia, Brazil, India, and South Africa, will probably be the chief beneficiaries of China's increasing consumption of iron ore. How long China can continue its extraordinary growth is the primary issue for the future of the iron ore industry. Based on the number and size of planned blast furnaces it appears that China's growth could continue for several more years. © 2004 Taylor and Francis.