My view is China is using stock piling at the port and also at the steel mills as a strategy to enable them to adjust their buying volume of IO up or down. That gives them the opportunity to manipulate the import volumes at will. Reducing imports for a short time creates a knock-on effect beating down the IO price and creates doubt in our sentiment about iron ores future. That article from Bejiing officials (analyst?) that turned the price flat a few weeks ago had the desired effect and beat the PIO down or at least stopped it growing so quickly.
In my view China have been paying top prices to stockpile because IO can easily stay high or get even higher. So China has to build up stocks to around 40-45 day buffer to play its cat-mouse game as well as satisfy its own for comfort zone when considering its huge consumption rate.
The futures for May17 at 690 yuan is the main focus but Sept2017 is building nicely as well at 628 yuan up 1.3%
I put up a thread about China stock piling about a month ago. I lined it up with the IO price.
The original Bloomberg article is the "Iron Ore's Party Is Just Getting Started. Great read as a holistic view and obviously the author is not getting paid by Chinese contacts.
So guess why China is pouring cold water on IO?