China's 2023 iron ore output to hit 8-year high -analysts
Adds comments, background
QINGDAO, China, March 30 (Reuters) -China's annual iron ore output is set to hit an 8-year high at 290 million tonnes, analysts said on Wednesday, after the world's top metals consumer lifted tough COVID measures that had impacted mining and as new capacity came online.
The production, highest since 2015, supports Beijing's plans to reduce its dependence on imports of the steelmaking raw material, typically around 1 billion tonnes each year.
Local supply will rise by 7 million tonnes, or 2.4%, from a year earlier, to 293 million tonnes, Xiao Wei, director of iron ore research at consultancy Mysteel, told a conference in Qingdao on Wednesday.
Analysts at China International Capital Corporation (CICC)601995.SS and Jiangsu Fushi Data Research Institute expect output of about 290 million tonnes.
The higher forecasts come after comparatively low volumes last year due to disruptions to logistics and labour because of COVID measures, environmental protection, output restrictions, and weak demand.
Safety checks at mines after a series of accidents last year also impacted output and are still having an impact, Xiao said.
Mysteel estimated last year's output at 286 million tonnes while consultancy Wood Mackenzie estimated output of 277 million tonnes, down 2.4% from the year before.
China has not yet published official output data for 2022.
However, output may not increase much more in the short-term, according to a Wood Mackenzie report to be released Friday, likely falling far short of industry targets.
The China Iron & Steel Association (CISA), a government-backed industry body, launched a plan last year to boost domestic iron ore supply to 370 million tonnes by 2025.
"We assume that China will only produce 198 million tonnes by 2025," said the Wood Mackenzie report.
Notable new projects are unlikely to be commissioned by 2025, it said, considering all of them are underground mines and complex geological conditions and high costs will lead to more construction issues.
Reporting by Amy Lv in Qingdao and Dominique Patton in Beijing
Editing by Vinay Dwivedi and Chizu Nomiyama
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