Iron ore inventories in China, the biggest user of the steelmaking ingredient, dropped to the lowest levels in two years as higher demand pushed up prices.
Stockpiles held at China’s major ports dropped 3.3 percent to 71.32 million metric tons as of Dec. 21, the lowest since Sept. 10, 2010, according to weekly data from researcher Beijing Antaike Information Development Co. The inventories, owned mostly by mills and traders, have dropped for eight straight weeks. Weekly inventories dropped to 73.81 million tons as of Dec. 21, researcher Mysteel.com said on its website.
Iron ore prices traded near a five-month high as China’s factory output and retail sales have accelerated for the last three months, signaling an economic recovery is accelerating. Ore imports reached 65.78 million tons in November, the second-highest level after a record 68.97 million tons in January 2011, according to customs data compiled by Bloomberg.
Ore with 62 percent iron content delivered to the Chinese port of Tianjin was unchanged at $135.40 a dry ton yesterday, after reaching $135.50 on Dec. 19, the most expensive since July 10, according to data compiled by The Steel Index Ltd. Prices have climbed 56 percent since Sept. 5.