Slowing economic growth in China hit the external trade of Brazil, the world’s second largest iron ore exporter, according to the Economic and Commercial Counselor’s Office of the Chinese Embassy in Brazil.
The spot iron ore price has so far fallen to US$75 a ton on average this year, which is US$23 a ton below last year’s average. China, the world’s largest mineral consumer, bought smaller amounts than expected this year as its manufacturing sector slowed, the office said on its official website this week. But globally China’s iron ore imports for 2014 still rose 14.7 percent judged year-on-year.
Nonetheless Brazil’s iron ore exports for November fell 16 percent year-on-year.
Total exports to all of Brazil’s customers for the commodity were valued at US$23.8 billion in the first 11 months of 2014, accounting for 11.5 percent of the nation’s total exports, the office said. Brazil is set to post its first annual trade deficit in 14 years as its year-to-date trade deficit reached US$4.2 billion.
China’s hunger for iron ore has risen in the past decade as China uses most of the imported minerals to make steel for use in domestic infrastructure, according to the business newspaper, The Wall Street Journal.
But steel consumption will continue to moderate next year in view of the sluggish economy, suggests a Chinese government think tank. The China Metallurgical Industry Planning and Research Institute also said on Wednesday the nation’s iron ore demand for 2015 is likely to show 6.4-percent growth year-on-year at 1 billion tons.