China: Iron ore imports fall 6% m-o-m in May despite resilient steel output

• Mills avoid large-scale inventory replenishment
  
  
• Policy stimulus expectations boost market sentiment
  
  

China's iron ore imports declined to 97.71 million tonnes (mnt) in May 2026, down nearly 6% from 103.9 mnt in April and below market expectations of 104-110 mnt, according to data released by the General Administration of Customs of China (GACC) on 9 June. Despite the monthly decline, cumulative imports during January-May 2026 reached 516.26 mnt, registering a 6.3% year-on-year increase.

The lower-than-expected import volumes came despite improved steelmaking margins, robust blast furnace operations, and healthy shipment levels from major global suppliers. Market participants attributed the decline primarily to cautious procurement strategies adopted by Chinese steelmakers amid concerns over seasonally weaker steel demand and an uncertain downstream consumption outlook.

Mills adopt hand-to-mouth procurement strategy

During May, most Chinese steel mills limited purchases to immediate production requirements rather than engaging in large-scale inventory replenishment. Expectations of softer demand from the construction sector and uncertainty surrounding steel consumption discouraged aggressive buying activity, resulting in lower import arrivals.

Nevertheless, steel production remained resilient. According to Mysteel, the average daily hot metal output among 247 surveyed blast furnace steelmakers increased by 5.2% from March levels to approximately 2.39 million tonnes per day in April, indicating sustained iron ore consumption despite restrained procurement.

Global iron ore prices edge higher

Despite weaker Chinese imports, global iron ore prices strengthened during May. Iron ore fines (Fe 61%, Australia origin) gained $2/t m-o-m to $109/dmt CFR China, supported by resilient Chinese steel production, steady hot metal output, and improving activity across the manufacturing and infrastructure sectors. Market sentiment also benefited from expectations of additional economic stimulus measures in China, while manageable port inventories and intermittent shipment disruptions from Australia and Brazil provided further support to seaborne prices.

However, gains were capped by continued weakness in China's property sector, abundant global iron ore supply, and cautious buying behaviour among steelmakers amid uncertain downstream demand conditions.

Port inventories decline on lower import arrivals

China's iron ore inventories at 34 major ports fell by 4 mnt m-o-m to 158 mnt in May. The decline was primarily driven by lower import arrivals and reduced port inflows during the month. With incoming cargo volumes falling below consumption requirements, port stocks gradually drew down despite steady blast furnace operations, leading to tighter port-side availability.

Outlook

China's iron ore imports are likely to remain moderate in the near term as steel mills continue cautious, need-based procurement amid seasonal demand weakness and an uncertain property market outlook. While steady hot metal production, lower port inventories, and potential policy support could underpin iron ore demand and prices, ample seaborne supply and subdued steel market sentiment are expected to cap any significant gains.