Iron ore inventories continue to increase in China

Iron ore stockpiles continued to build up at 25 major ports during the week ending on Aug. 6 despite signs of stabilizing prices, according to Xinhua's latest iron ore price report released on Tuesday.

Inventories of imported iron ore at the ports stood at 98.76 million metric tons, up by 420,000 metric tons week on week.

After falling more than 15 percent since the beginning of the year, imported iron ore prices were supported temporarily by efforts to replenish stocks, with the price index for 63.5-percent-grade iron ore imports remaining unchanged at 122 points from the previous week.

The index for 58-percent-grade imports remained at 102 points for the week after losing about 14 percent this year.

A "wait-and-see" sentiment has led steelmakers to proceed with caution, as overstocking has weighed on the prices of raw materials, Xinhua analysts said in the report.

Since sales of steel products are traditionally weak in August, the steel market is not expected to see a rapid recovery in the near future unless the government adopts stimulus measures to tackle the sector's downward pressure, Xinhua analysts said.