Japan’s iron ore market
Japan accounts for between 10% and 13% of the seaborne iron ore market. Japanese iron ore imports are a good indicator of iron ore demand.
Japan’s Ministry of Economy, Trade, and Industry releases the data for Japanese iron ore imports on a monthly basis. Japan’s iron ore imports for the month of October were 11.68 million tons, which is 5.3% higher month-over-month and 4.2% lower year-over-year.
Japan’s cumulative iron ore imports during the initial ten-month period of the year totaled 113.07 million tons, remaining more or less flat with the 113.57 million tons imported between January and October last year.
Japan hasn’t taken much advantage of lower iron ore prices, which are down ~49% year-to-date. The overall picture indicates negative to moderate demand for iron ore in Japan.
Weak demand from major consumers such as China and Japan is putting more pressure on iron ore prices. It also negatively impacts iron ore companies in the seaborne trade, including Rio Tinto (RIO), BHP Billiton Limited (BHP), Vale SA (VALE), and Cliffs Natural Resources Inc. (CLF). Lower demand also affects funds investing in these stocks such as the SPDR S&P Metals and Mining ETF (XME).