(Bloomberg)—Iron ore imports by China dropped last month from a record as steelmakers in the largest producer reined in output before a national holiday. Overseas purchases fell to 82.19 million metric tons from 96.27 million a month earlier, according to customs data on Monday. In 2015, imports rose 2.2 percent to 952.72 million tons. Iron ore has collapsed to less than a quarter of its 2011 peak as China’s economy slows, and miners including BHP Billiton Ltd., Rio Tinto Group and Vale SA boost supply to defend market share. Mills in China typically curb output before the Lunar New Year break, which ran from Feb. 8 to 12 this year. The country accounts for about half of the world’s steel supply and buys more than two-thirds of seaborne iron ore. “January tends to be a lull period for China’s steel output, so iron ore import volumes declined a bit,” Wu Zhili, an analyst at Shenhua Futures Co. in Shenzhen, said by phone. “The recent rise in port inventories reflect weak usage before the Lunar New Year.” Stockpiles at Chinese ports climbed to 95.5 million tons on Feb. 14 compared with 92.85 million tons on Feb. 4, the last working day before the break, according to data in an e-mail from Shanghai Steelhome Information Technology Co. That’s the highest level since May.

Tumbling Prices

“The fact that a lot of that iron ore was stockpiled suggests end-use demand remained tepid before the Chinese New Year,” Australia & New Zealand Banking Group Ltd. analysts including Daniel Hynes said in a note on Monday. “With prices dipping below $40 a ton early in January, there appears to have been some opportunistic buying.” Ore with 62 percent content delivered to Qingdao was at $43.65 a dry ton on Friday, according to Metal Bulletin Ltd. The commodity bottomed at $38.30 in December, the lowest for daily prices dating back to May 2009, and was 4.3 percent lower last month. As China’s government tries to reduce the economy’s reliance on construction and heavy industry, steel consumption is dropping for the first time in a generation. Given the fall in local demand, Chinese mills have flooded the world with record exports, spurring trade tensions. Outbound cargoes of steel products totaled 9.74 million tons in January from about 10.65 million tons the previous month, according to the customs data. Last year, exports surged 20 percent to an all-time high of 112.4 million tons.