Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Australia’s iron ore shipments are anticipated to rise from 900mn mt in FY2021 (ending Jun 30) to 1.1bn mt by FY2026. 


Iron ore export value is expected to achieve a record AU$136bn ($104mn) in FY2021 an increase from AU$102bn in FY2020, according to media reports citing an Australian government study. Australia’s iron ore export value to China may decrease from AU$35bn to AU$23-25bn during the same period under review due to environmental restrictions. 


China imported 60pc of its iron ore from Australia and accounted for 70-75pc of the world’s iron ore exports in recent times. Australia is diversifying demand for the commodity.


Key mining regions

BHP, Rio Tinto, and Fortescue Metals (FMG) are excavating more iron ore from Western Australia’s Pilbara region. The additional volumes and strong expected prices place export value expectations for the commodity at more than AU$100bn annually for the next five years. 


Guinea is estimated to add 200mn mt of iron ore annually, to increase the supply of Western Australia’s current production by 15-20pc through Rio Tinto’s Guinea project, which will begin in 2027-2028. The Simandou southern deposit is a joint venture with Chinalco, a Chinese entity, and the Guinea government. The company is reviewing infrastructure costs that include port, rail, and road access to its remote location for export availability.


Development in the Simandou northern deposits by China’s SMB and Winning Consortium will begin in 2025-2026 given the $14bn signed infrastructure contract with the two companies.


The export of other minerals such as copper, lithium, and nickel is also anticipated to increase in volume and firm pricing to counteract the lower financial contribution from thermal coal exports. 



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