China's iron ore market was to be judged by import volumes alone, the image would be one of gentle and steady growth.

But beneath the calm picture presented by imports of the main steel raw material is a tug-of-war between China, which buys about 75% of global seaborne supplies, and Australia's miners, which provide around two-thirds of China's needs.

Beijing is attempting to gain more control of iron ore pricing, seeking to leverage its buying power to secure favourable terms.

The problem is that Australian miners such as Rio Tinto (RIO.AX)(RIO.L), BHP Group (BHP.AX) and Fortescue (FMG.AX) have considerable market power of their own as China has no alternative sources that supply the volume of required iron ore.

China's imports of iron ore were 109.82 million metric tons in September, up 1.2% from August, while arrivals for the first nine months of 2026 were 954.97 million tons, an increase of 4.1%, according to customs data.

October imports are likely to be similar to those for September with analysts DBX Commodities tracking seaborne arrivals of 105.7 million tons. China also buys small volumes overland from neighbouring countries.

The modest gain in iron ore imports so far in 2026 comes despite weakness in the steel sector, which is suffering from weak profitability and declining production amid ongoing weakness in the key housing construction sector.

Rather than being used to lift steel production, the gain in iron ore imports has largely flowed to rebuilding stockpiles. Port inventories monitored by consultants SteelHome were assessed at 152.23 million tons in the week to October 23, up 14% from 133.6 million in the same week in 2025.

Lower prices in recent weeks have boosted import appetite, with Singapore Exchange contracts ending at $90.60 on October 23, down 19% from the $111.91 peak so far this year on May 11.

The drift lower in iron ore prices also comes amid efforts by China's state-controlled buyer, China Mineral Resources Group (CMRG), which functions as an intermediary between iron ore miners and steel mills.

In practical terms this has resulted in CMRG imposing a series of measures at various times against the Australian miners, in what are viewed by market participants as attempts to exert greater control over prices and supply contracts.

CMRG reached a supply deal with Rio Tinto, the world's largest iron ore miner, last week, according to people with knowledge of the matter, although details of the agreement were not immediately known.

The deal came after CMRG instructed some steel mills in August to halt talks with Rio for September-loading cargoes.

CMRG is still in dispute with Fortescue, with the company flagging on October 22 that if talks aren't concluded by the end of the year, operations may be affected.

A similar dispute in which CMRG restricted purchases from BHP was resolved in April, and while terms weren't disclosed, it is believed the miner agreed to use several pricing indexes and accept small discounts.

Overall, it would appear that CMRG is having some small success in extracting better terms from the Australian miners.

However, China remains highly dependent on Australia for iron ore, and will remain so for years to come even as it seeks to diversify suppliers, with the ramp-up of the 120-million-tons-a-year Simandou project in Guinea being the primary example.

It's also likely that iron ore prices will be driven mainly by the steel sector, and the decline in recent months tallies with lower steel production, which was down 2.9% in the first nine months of the year to 724.77 million tons.