Australia: Iron ore export shipments fall 10% m-o-m in Jul'23

Australia's iron ore and pellet export shipments fell 10% m-o-m to 69.6 million tonnes (mnt) in July 2023 compared to 77.5 mnt in June, as per vessel line-up data maintained with SteelMint. Iron ore exports from Australia fell amid tighter steel production restrictions in China, which impacted iron ore demand.

According to market reports, some Chinese steel mills got crude steel production control targets for 2023 that were mostly within 2022 levels, further influencing iron ore demand forecasts.

Exports to China drop 12%

Australia's iron ore exports to the world's largest importer, China, were recorded at 57.6 mnt in July, down 12% m-o-m against 65.3 mnt in June. Australian iron ore shipments to China fell sharply as news of steel production reduction is spreading in the market which weighed on iron ore.

South Korea and Japan were the second- and third-largest iron ore importers from Australia in July. The latter supplied 4.3 mnt to South Korea, up by 10% m-o-m, while 4.1 mnt was shipped to Japan.

Shipper-wise performance

Rio Tinto's iron ore shipments were the highest at 25.91 mnt in July, marginally down by 4% m-o-m against 27.06 mnt in June. BHP and FMG shipped 22.45 mnt and 12.44 mnt, respectively.

Port-wise exports

Port Hedland exported 41.92 mnt of iron ore in July, down 14% m-o-m compared to 48.99 mnt in June followed by Port Walcott at 14.74 mnt, down 5% m-o-m, and Port Dampier at 11.17 mnt, marginally down by 3% m-o-m.

Price trends

Monthly average Australian Fe62% iron ore prices were largely stable at $112/t CFR China in July compared to June.

Outlook:

Iron ore exports may remain sluggish in the July-September, 2023 (3rd quarter of CY'23) due to the monsoon season in China, low steel demand and some macroeconomic factors.