COLUMN-Big iron ore miners supply strategy working partially: Russell
--Clyde Russell is a Reuters columnist. The views expressed are his own.--
By Clyde Russell
LAUNCESTON, Australia, Jan 14 (Reuters) - China's record imports of iron ore in December capped a year of strong growth, while also proving that the strategy of the big miners is at least partially working.
China brought in 86.85 million tonnes of the steel-making ingredient in December, bringing the total for 2014 to 932.5 million tonnes, a gain of 13.8 percent over the previous year.
The jump in iron ore imports isn't because China is producing more steel, with output of crude steel rising a mere 1.9 percent in the first 11 months of 2014 over the same period in 2013, according to official figures.
It's also not because huge stocks of iron ore are being built up in warehouses, with inventories monitored by the Shanghai Futures Exchange SH-TOT-IRONINV dropping to 99.85 million tonnes in the week to Jan. 9, the lowest in 11 months.
The most logical explanation is that the 47-percent decline in the Asian spot iron price in 2014 .IO62-CNI=SI is displacing some high-cost Chinese domestic output.
This has been the strategy of the big three iron ore miners, Brazil's Vale and the Anglo-Australian pair of Rio Tinto and BHP Billiton. Continuación...