Due to the increased cost of iron ore supply, coupled with the national steel production during the Spring Festival holiday is limited, before the arrival of the Chinese New Year holiday, Chinese iron ore port storage may exceed 100 million metric tons.

Bloomberg news agency quoted Zhao beyond futures analyst commented that the reason for the prediction port stocks above scale, originated from Australia and Brazil iron ore shipped to Chinese ports increased, especially in December last year, the sharp rise in shipments, And China’s own needs but also in the period before the Spring Festival this seasonal weakness.

Last week, China Customs announced in December last year, China’s iron ore import volume growth of 17%, to a record 96.27 million tons, the continuation of the growth momentum in November. Wall Street was informative article mentioned that the recent iron ore imports and steel industry rebound may pick up related. Last December the steel industry PMI data was 40.6, although still far below the line ups and downs, but the previous value of 37, a sharp improvement.

Beyond Zhao pointed out that domestic steel mills usually yield contraction in the Chinese New Year holidays, as construction activity slowed down, the workers holiday. Festival more mills will resume production, boosting demand for iron ore, port stocks are expected to fall.

Bloomberg also mentioned that a Shanghai Information Technology Co., data showed last week, Chinese iron ore port stocks rose 1.7 percent to 94.55 million metric tons, not only in the past four months, the stock continued to grow, but also over the five-year average of 92.7 million mt. Last reach 100 million tonnes in March last year.

Chinese iron ore port stocks increase means that the market oversupply situation continued, iron ore prices will be under further downward pressure. Last week, Citigroup also expects iron ore inventories at Chinese ports may more than 100 million tonnes in the first half of this year, also expects iron ore price of $ 36 per ton, compared with the previous forecast by 12%.

Last week, Citigroup Asia head of commodities research at Ivan Szpakowski said that iron ore is a high possibility this year of $ 30 per tonne below the important price, the main pressures from the demand side, “weak Chinese demand for steel, which means Steel production will decline, he said Chinese demand for iron ore will be weaker. “