China's iron ore price will continue to drop in the fourth quarter of this year amid a fall in demand, according to new analysis.
Demand has usually shrunk in the fourth quarter every year, especially in north China, and the corresponding slack season for steel production may bring a short-term recession in demand for iron ore, according to a report in the Shanghai Securities News on Friday.
Stockpiles of iron ore at 25 major ports in China continued to grow last week, marking the fourth consecutive week of growth.
Inventories of imported iron ore totaled 77.82 million tonnes at the end of October 29 to November 4, up 1.29 million tonnes, or 1.68 percent, from the previous week, according to industry data.
Analysts said the weak demand of steelmakers will continue as November is the slack season for the industry and it is unlikely there will be large-scale buying orders.
They forecast the ongoing Third Plenary Session of the 18th Communist Party of China Central Committee will bring positive policies to the industry and steel prices may rebound in the short term.
The domestic demand for iron ore rose in the first three quarters, and production and imports both soared during January-September.
The Shanghai Securities News cited a report showing that the rate of domestic mining rebounded in July-August due to a considerable iron ore price in southern and northeastern China, while in eastern and northern China, the rate rose steadily.
The National Bureau of Statistics said the domestic yield of raw ore was 136 million tonnes in September, a quarterly rise of 6.81 million tonnes, or 5.2 percent.
