Preview: China iron ore, crude imports seen up in Nov on restocking

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China's imports of crude oil and iron are expected to rise in November as refineries raise runs and steel mills restock. (Reuters) China's imports of crude oil and iron are expected to rise in November as refineries raise runs and steel mills restock. (Reuters)
SummaryChina's imports of crude oil and iron are expected to rise in November as refineries raise runs and steel mills restock.

the higher refinery runs.

China imported 5.58 million barrels a day in October as new facilities came on stream and refiners ramped up output to replenish stocks.

COPPER

Any increase in copper imports in November is likely to be a statistical anomaly brought about by the October holiday, which caused a delay to shipments, traders confirmed.

"Our bookings for November shipments were similar to October but actual arrivals were higher, with some metal due to arrive in October delayed by the holiday," said a refined copper trader at an international trading house.

China's imports of anode, refined metal, alloy and semi-finished copper products dropped 18.5 percent from the previous month to 321,879 tonnes in October.

IRON ORE

Traders said they expected November imports of iron ore to show a rise following a price recovery in the previous month.

"Iron ore prices rose quickly after the (Oct. 1) holiday, prompting traders and steel mills to make bookings, and the shipments will have arrived in November," said a Beijing trader.

Although steel production dwindles in the cold winter months as construction activities decline, many traders traditionally take the opportunity to restock ahead of the Chinese new year.

Li Xinchuang, vice-secretary general at the China Iron and Steel Association, said last week that 2012 iron ore imports were expected to reach around 730 million tonnes, implying that overseas cargoes will hit around 65 million tonnes in November and December, up from 56 million tonnes in October.

SOYBEANS

Traders do not expect November soy imports to show any substantial recovery, even though shipments declined 18.9 percent in October, with crushing margins poor over the month.

Buyers canceled 500,000 tonnes of cargoes from the United States early in the month to avoid losses.

Still, local crushers are now facing shortages as the peak consumption season approaches, and buyers started to increase purchases in the second half of the month.

Margins, though still negative, are improving, especially after Beijing halted state stockpile sales in mid-November.

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