Australia: Iron ore export shipments up 2% y-o-y in H1CY'24

Australia's iron ore and pellets export shipments rose by 2% y-o-y to 427 million tonnes (mnt) in H1CY'24 (January-June 2024) compared to 417.4 mnt in H1CY'23, as per vessel line-up data maintained with BigMint. Meanwhile, shipments rose by 8% m-o-m to 80.2 mnt in June'24 as compared to 74.6 mnt in May'24. Approaching fiscal year end is likely to have boosted production and shipments.

The initial months of 2024 witnessed heavy rains and unfavourable weather conditions that disrupted mining operations and logistics, particularly in February. As weather conditions improved, mining activities and shipments were able to rebound, contributing to the increased export volumes in subsequent months.

There was a significant rise in steel production from the blast furnace route in Southeast Asian countries, which led to increased demand for raw materials, including iron ore. Notable expansion in steel production capacities in countries like Indonesia and Vietnam boosted the demand for Australian iron ore.

Exports to China up in H1CY'24

Australia's iron ore exports to the world's largest importer, China, were recorded at 360 mnt in H1, an increase of 2% y-o-y against 352 mnt in H1CY'23. Meanwhile, exports rose by 9% m-o-m to 68.8 mnt in June as against 62.8 mnt in May.

Despite some fluctuations, Australia's iron ore exports to China remained robust. China's continued strong demand, especially after the Lunar New Year holidays, contributed to the overall increase in export volumes.

Japan and South Korea were the other major importers from Australia. The latter supplied 24.5 mnt to Japan, down by 3% y-o-y, while 23.6 mnt was shipped to South Korea, largely stable as compared to the same period of last year.

Shipper-wise performance

Rio Tinto's iron ore shipments were the highest at 145.4 mnt in H1, down by 4% y-o-y against 150.5 mnt in H1CY'23. BHP and FMG shipped 139 mnt and 100.3 mnt, respectively.

Port-wise exports

Port Hedland exported 272.4 mnt of iron ore in H1, up 6% y-o-y compared to 257.3 mnt in H1CY'23 followed by Walcott at 77.9 mnt, down 8% y-o-y. Meanwhile, Port Dampier increased shipments by 4% y-o-y to 67.5 mnt.

Price trends

Monthly average Australian Fe 62% iron ore prices in H1 remained largely stable y-o-y at $118.33/t CFR China against $117.6/t in the same period of last year which provided a favourable environment for maintaining high export volumes.

Outlook

Australia's iron ore export shipments are expected to edge up in the coming months, supported by stable demand from key markets and efficient port operations. However, Chinese demand and macroeconomic factors may introduce some volatility in the market.