China's iron ore import is expected to increase by 10 percent to about 301 million tons in 2006, according to the China Iron and Steel Association.

China imported 275 million tons of iron ore last year when the country produced 349 million tons of crude steel, according to an earlier report of the National Development and Reform Commission.

The association predicted that China's total iron ore output would reach 528 million tons this year, an increase of 48 million tons from last year.

The total production of crude steel is estimated at 384 million tons this year, with the demand for iron ore rising by 45.88 million tons year on year to 558 million tons.

According to the association, major mines in China produced 102.9 million tons of iron ore in the first quarter of this year, up 32.83 percent year on year.

Under the backdrop of increasing iron ore supply -- international supply is expected to rise by a fairly big margin and domestic production is growing steadily, China is set to cut its out-of-date iron and steel production capacity.

The government has decided by cut the pig iron production capacity by 43 million tons this year, which would result in reduction of iron ore demand by some 60 million tons, according to the association.

Source: Xinhua