Global iron ore trade is expected to increase by 4.5 percent due to higher supplies especially from Brazil and Australia, according to the Resources and Energy Quarterly, a report from the government of Australia’s Department of Industry, Innovation and Science.
The report said that the global trade in 2015 was estimated to have increased by 1.8 percent in 2015 to 1.4 billion tonnes, the slowest growth since 2001. Australian supplies are estimated to have increased by seven percent to 767 million tonnes and China’s imports are estimated to have increased by 0.3 percent to 930 million tonnes. Japanese imports fell by 3.5 percent and South Korean imports fell 0.6 percent, the report said.
Chinese domestic production fell by nine percent year-on-year in the first nine months of 2015, according to the report. As the price of seaborne iron ore fell, China’s iron ore miners struggled to remain profitable, and consequently, China’s imports of seaborne iron ore were stable through the first 10 months of 2015, despite lower steel production, the report added.
The report said it was expected that in 2016, China’s imports of iron ore will increase by 1.6 percent, reflecting continued decline in domestic production, with consumption expected to remain relatively steady. Consequently, Australian exports to China are estimated to have increased by nine percent year-on-year during the first 10 months of 2015 to 498 million tonnes and to grow by 13 percent to 868 million tonnes.
Australia, which accounts for about 64 percent of Chinese iron ore imports, came at the expense of smaller, high-cost producers such as Iran, Ukraine, Canada and South Africa. China’s share of imports from smaller producers declined from around 30 percent at the start of 2014 to 16 percent in the first 10 months of 2015. Brazil’s share of China’s imports increased slightly from 18 percent in 2014 to 19 percent in the first 10 months of 2015.
India’s exports are expected to fall from five million tonnes in 2015 to 4 million tonnes in 2016, the report said.