Global iron ore production to recover by 5.1% in 2021 after Covid-19 hit output in 2020, says GlobalData
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Global iron ore production to recover by 5.1% in 2021 after Covid-19 hit output in 2020, says GlobalData

By GlobalData 07 May 2021 (Last Updated May 6th, 2021 09:49)

Global iron ore production fell by 3% to 2.2bnt in 2020. Declines from Brazil and India were major contributors to the reduced output in 2020.

Global iron ore production fell by 3% to 2.2bnt in 2020. Declines from Brazil and India were major contributors to the reduced output in 2020. Combined production from these two countries fell from a collective 638.2Mt in 2019 to an estimated 591.1Mt in 2020. The reduced output from the iron ore giant, Vale was the key factor behind Brazil’s reduced output while delays in the auctioning of mines in Odisha affected India’s output in 2020.

Miners in Australia were relatively unaffected by Covid-19 due to effective measures adopted by the Australian Government while a speedy recovery in China led to a significant 10.4% increase in the country’s iron ore output.

Looking ahead, global iron ore production is expected to increase by 111.3Mt to 2,302.5Mt in 2021. Rio Tinto is expected to produce up to 340Mt of iron ore, whilst BHP has released production guidance of 245–255Mt, helped by the start of the Samarco project in December, which is expected to produce between 1Mt to 2Mt. The company has retained its guidance for Australian mines at 276Mt to 286Mt on a 100% basis due to scheduled maintenance work at its ore handling plant and tie-in activity at the Area C mine and South-Flank mine.

The remaining companies are expected to produce more than 600Mt of iron ore, including FMG, whose production is expected to range between 175Mt and 180Mt, supported by FMG’s Eliwana mine that commenced operations in late December 2020 and Anglo American, which is expecting to produce between 64Mt and 67Mt. Vale is expected to resume 40Mt of its production capacity, taking its overall production capacity to 350Mt in 2021, with production guidance of 315Mt to 335Mt.

Global production over the forecast period (2021-2025) is expected to grow at a CAGR of 3.7% to 2,663.4Mt in 2025. The key contributors to this growth will be Brazil (6.2%), South Africa (4.1%), Australia (3.2%) and India (2.9%). Key upcoming projects expected to commence operations include South Flank in Australia (2021), Zulti in South Africa (H2 2021), Serrote Da Laje in Brazil (H2 2021) and Gudai-Darri (2022).

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