NCP Halves China Tangshan's Iron Ore Concentrates Output

The daily output of iron ore concentrates in Tangshan, North China's Hebei province, declined by around 37,200 MT/day or 50% to 36,800 MT/d as of February 18, as most mining companies including large-scale ones have suspended operations with the ongoing battle against Novel Coronavirus Pneumonia (NCP), according to Mysteel's latest survey released on February 19.

On February 13, the Tangshan government requested all the companies including iron ore miners in all the three districts including Qian'an, Qianxi and Zunhua to halt operations on noting the growing number of NCP cases, allowing only those involved in crucial construction projects and supplying citizens' daily necessities and medical goods to keep operating, Mysteel Global understands from a government notice, with no resumption dates mentioned.

Iron ore concentrates output from the three districts accounts for about 70% of Tangshan's total output, and the stoppage affected 35,400 MT/d output, or 94.6% of the total decrease in Tangshan's output, Mysteel's survey showed.

The latest order from the Tangshan government indicated the intensified efforts from the local government in fighting against the epidemic as back in early February, it ordered only small- and medium-sized mining enterprises mainly located in Tangshan's Qianxi and Zunhua to suspend operations to minimize the spread of virus among the employees.

The large-sized mining companies in Tangshan had been spared from the suspension early this month as "the government had intended to curtail the impact of concentrates supply", according to a Mysteel analyst participating in the survey.

For now, only the iron ore mining companies that are affiliated to the state-owned steel mills are still operating as per normal, which an official from the mining subsidiary of the state-owned Shougang Group in Qian'an confirmed, as steel mills in Tangshan and elsewhere in China have been given the freedom to adjust their pace of operations so long as they have take effective measures to battle against the NCP, Mysteel Global noted.

Hebei is China's top iron ore-producing province, and Tangshan accounts for about one third of the province's iron ore concentrates output, according to Mysteel's database.

The decline in supply, however, has not dented the iron ore concentrates price much in Tangshan with the price of the 66% grade concentrates down merely Yuan 10/dmt (convert to $/dmt) from January 23 to Yuan 825/dmt as February 19 according to Mysteel's assessment, as local steel mills and re-rollers have idled their blast furnaces or rolling mills amid the sluggish steel demand from downstream users.