SMM

SMM reports domestic iron ore mine capacity utilization rate in December 2023 rose to 56.5%, up 0.8% MoM, with concentrate production reaching 21.549 million mt, up 1.002 million mt MoM.
December's rise in capacity utilization rate was driven by 1) steel mills' pre-holiday restocking, sparking demand for iron ore concentrate and more domestic mine purchasing due to cost advantages, spurring mining production, and 2) large mines boosting operations to hit annual targets, with some completing upgrades and ramping up output.
January's capacity utilization rate may slightly rise due to: 1) domestic mines, particularly large state-owned ones, aiming for a strong yearly start and full capacity operations; 2) mines planning higher annual output in 2024, raising monthly averages; 3) steel mills' sustained high concentrate demand and expected molten iron production increases, suggesting continued upticks in capacity utilization rate.