China remained a net steel importer in May, while loading 53.46 million tonnes of overseas iron ore, down slightly from a record 57 million tonnes in April, the General Administration of Customs said on Thursday.
Customs data showed China was a net importer of around 1 million tonnes of crude steel in May, marking the third month running that inflows have exceeded outflows for the country, which had been a net steel exporter since 2005.
Steel product exports in May were at 1.35 million tonnes, down 60,000 tonnes from April and marking the lowest monthly level since the second half of 2004, while imports were at 1.65 million tonnes, the Customs said.
China imported 700,000 tonnes of steel billets in May but there were no exports, it said.
China, the only major producer with steel output higher than last year, is enjoying a flood of iron ore imports, thanks to a collapse in world prices, cheap shipping, and its uniquely buoyant steel sector.
In another development, the high iron ore imports reflected slowing domestic output due to the high cost of production compared with mines in places like Australia, Brazil and India.
Chinese steel mills have been relying on the spot market to source the feedstocks for their blast furnaces due to their failing to afford the term prices last year as the global financial crisis and a residential housing slump cut consumption and pulled down steel prices.
China has demanded a 40 to 45 percent cut in iron ore prices from Australian miners Rio Tinto and BHP Billiton for the 2009/10 term year, rejecting a 33 percent reduction already accepted by several other major Asian mills, including Japan's Nippon Steel and JFE Holdings and South Korea's POSCO.
Brazilian miner Vale said on Wednesday it cut fine ore prices to Japan and South Korea by 28.2 percent from 2008 levels, less than the cut offered by Rio Tinto and far short of the reduction China is seeking.
Source: Reuters
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