Global steel production is expected to grow at an annual average of 32pc from 2021-2025 and then by 1.4pc between 2026-2030, according to Fitch Solutions’ report.
The report forecasts global mine output to grow at an average of 2.4pc over 2021-2025 compared to -2.0pc in the previous five years. Annual production is expected to rise by 378mn mt in 2025 compared to 2020 levels, roughly the equivalent of India and Russia’s combined 2020 output, stated the report.
* In China, iron ore production will stabilize to 900mn mt per year in this decade.
* In Brazil, iron ore output will rebound to a 5.9pc growth rate over the next five year.
* In Australia, iron ore production will grow at 1.7pc till 2025 before stagnating.
* Global steel production to grow by 4.9pc in 2021 after contracting by 0.1pc in 2020, driven by 7.5pc growth in steel production in China and 6.2pc growth in India, the two largest steel producers.
* Global steel production to grow at an annual average of 32pc over 2021-2025 and then by 1.4pc over 2026-2030.
* Global iron ore consumption to steadily slow over subsequent years.
In China, iron ore production will stabilize to 900mn mt over the coming decade, though lower than the 2015 level of 1.4bn mt. Output growth will be prevented by weak iron ore prices and tightening environmental regulations. China’s iron ore sector will become increasingly consolidated as historically low iron ore prices will price out high-cost domestic miners in the coming years. Miners from Hebei, Fujian, Guangdong and Xinjiang, known for their high-priced iron ore, will take a hit.
Brazil’s iron ore production will rebound compared to 2018-2020 as low operating costs, project expansions and high-quality iron ore from the country is being preferred by steel producers in China. Iron ore production is forecast to increase at 5.9pc annually from 2021onwards — up from 391mn mt in 2020 to 529mn mt in 2025. However, it will slow down over the long term to 1.7pc in the 2026-2030 period, which would take annual output to 575mn mt by 2030.
In Australia, iron ore production is set to grow annually at 1.7pc in 2021-2025, with annual output reaching 84mn mt by 2025. However, the growth rate is still 3.4pc less than the previous five years’ rate. The output will peak around mid-decade to 1.05bn mt before stagnating. This production slowdown will be due to mothballing of mines by junior miners and a pullback in capital expenditure by larger firms as iron ore prices decline, according to the report. The low cost of production compared to West Africa and China will work in Australia’s favour.