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Australian iron ore miners benefitting at expense of higher cost suppliers

Comments from  Fortescue Metals Group reported by Bloomberg:

  • Said China is absorbing supply increases as higher cost producers are displaced
  • Chinese port and steel mill inventories have fallen below historical averages
  • Major producers from Australia significantly increased output
  • “This implies ongoing displacement of high cost suppliers in China and other countries”
  • Shipments from Fortescue’s mines in Australia rose 49 percent to 39.9 million metric tons in the three months ended Dec. 31, from 26.7 million tons a year earlier
  • Shipments fell 2 percent compared with the previous three months, the first decline since September 2012, according to the statement

More:

  • Shipments from Australia accounted for 59 percent of China’s overseas iron ore purchases last year from 51 percent in 2013, according to customs data.
  • Brazil’s share was 18 percent from 19 percent in 2013
  • Exports from the rest of the world fell to 23 percent from 30 percent

 

 

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