Iron ore prices have displayed volatility in the past few years as the world has dealt with the economic uncertainty surrounding COVID-19 lockdowns, the Russia-Ukraine war and rising levels of inflation.
Prices for the base metal reached a record high of over US$220 per metric ton (MT) in May 2021, but it wasn’t long before they declined to a low point of US$84.50 in November of that year. At the time, analysts identified lower demand from China alongside rising supply levels as reasons why prices dropped so drastically in late 2021.
Iron ore prices have rebounded to trade in the US$120 to US$130 range in 2023, spurred on by supply issues in Australia and Brazil, as well as the Russia-Ukraine war; higher export duties in India and renewed demand from China have also contributed to the commodity’s higher prices. Positive sentiment in the iron ore market is expected to continue into 2024.
To understand the dynamics of the iron ore market, it’s helpful to know which countries are major producers. With that in mind, here are the 10 top iron-producing countries of 2022, using the latest data provided by the US Geological Survey.
1. Australia
Usable ore: 880 million MT; iron content: 540 million MT
Australia is the largest country for iron ore mining, and its usable iron ore output was 880 million MT in 2022. Australia’s leading iron ore producer is BHP but Rio Tinto and Fortescue Metals Group are also big producers.
The Pilbara region is the most notable iron ore jurisdiction in Australia, if not the world. In fact, Rio Tinto calls its Pilbara Blend “the world’s most recognised brand of iron ore.”
2. Brazil
Usable ore: 410 million MT; iron content: 260 million MT
Major producer Brazil saw its usable iron ore production total 410 million MT in 2022.
The largest iron ore districts in the country are the states of Pará and Minas Gerais, which together account for 98 percent of Brazil’s annual iron ore output. Pará is home to the largest iron ore mine in the world, Vale’s Carajas mine. Headquartered in Rio de Janeiro, Vale is the world’s biggest producer of iron ore pellets.
Brazil is expected to boost its output this year. “In 2023, supply ramp up will be led by Brazil and India, while Australian shipments will stay largely rangebound,” said David Cachot, research director for steel and raw materials at Wood Mackenzie. Indeed, Brazilian iron ore exports are on the rise in 2023.
3. China
Usable ore: 380 million MT; iron content: 240 million MT
China is the world’s largest consumer of iron ore, despite being only the third largest iron-producing country. Its production of usable ore fell by 14 million MT in 2022 from the previous year.
With China being the world’s largest producer of stainless steel, its domestic supply is not enough to meet demand. The country imports over 70 percent of global seaborne iron ore.
4. India
Usable ore: 290 million MT; iron content: 180 million MT
India’s production of usable iron ore increased from 2021 to 2022, climbing from the previous year’s mark of 273 million MT to 290 million MT. Its iron content production rose from 168 million MT to 180 million MT.
India’s largest iron ore miner, NMDC, hit a production milestone in 2021 of 40 million MT per year, the first such company to do so in the country. NMDC is targeting an annual production rate of 50 million MT in 2023 and 100 million MT by 2030.
5. Russia
Usable ore: 90 million MT; iron content: 63 million MT
Russia comes in as the fifth largest iron-producing country in the world. Usable iron ore production in 2022 fell by 6 million MT from the previous year, while iron content inched down from 66.7 million MT to 63 million MT.
In 2022, Russia’s iron ore exports fell dramatically as the world enacted serious economic sanctions on the country over its aggressive war against Ukraine. Together, these two countries account for 36 percent of global iron or non-alloy steel exports. The European Union has restricted imports of Russian iron ore.
6. Ukraine
Usable ore: 76 million MT; iron content: 47 million MT
The number six spot in terms of usable iron ore production is shared by Ukraine and South Africa. Ukraine’s iron ore and steel industry accounts for 10 percent of the nation’s gross domestic product.
Russia’s invasion is having a significant impact on Ukraine’s iron ore exports, on which the European Union’s steel industry depends. “Many European steel producers relied on Ukraine for raw materials such as metallurgic coal and iron ore. Ferrexpo, the London-listed Ukrainian miner, is a major exporter of iron ore,” notes the Financial Times in a mid-2022 article. Ukraine’s production in 2022 fell by more than 9 percent from the previous year.
6. South Africa
Usable ore: 76 million MT; iron content: 48 million MT
South Africa’s usable iron ore production rose from 73.1 million MT to 76 million MT in 2022. The country’s iron ore content also jumped from 46.5 million MT to 48 million MT.
Kumba Iron Ore is Africa’s largest iron ore producer. The company has three main iron ore production assets in the country, including its flagship mine, Sishen, which accounts for a large majority of Kumba’s total iron ore output. Anglo American owns a 69.7 percent share of the company.
8. Iran
Usable ore: 75 million MT; iron content: 49 million MT
The seventh largest iron-producing country is Iran, which rose to that spot from 10th place the prior year. In 2022, it produced 75 million MT of usable iron ore and 49 million MT of iron content, up from 72.9 million MT and 47.9 million MT, respectively.
One of the most important iron ore mines in the country is Gol-e-Gohar in Kerman province. The Iranian government is targeting production of 55 million MT of steel per annum by 2025 to 2026. To reach this goal, the country’s iron ore industry will need to produce 160 million MT of iron ore. To better meet the requirements of domestic steel producers, Iran began levying a 25 percent duty on iron ore exports in September 2019.
9. Kazakhstan
Usable ore: 66 million MT; iron content: 14 million MT
Kazakhstan is the ninth largest iron-producing country in the world. Usable iron ore production rose slightly from 64.1 million MT in the previous year to a record 66 million MT in 2022, while iron content inched up from 13.1 million MT to 14 million MT.
Kazakhstan has several iron ore mines in operation, with four of the top five owned by Eurasian Resources Group and one held by ArcelorMittal. The Sokolov-Sarybai Mining Production Association (SMPA) in Northern Kazakhstan was the main supplier of iron ore to Russia’s Magnitogorsk Iron and Steelworks prior to the country’s invasion of Ukraine. Since then, the SMPA has halted iron ore shipments to Magnitogorsk.
10. Canada
Usable ore: 58 million MT; iron content: 35 million MT
Coming in as the 10th largest iron-producing country, Canada’s production totaled 58 million MT of usable iron ore and 35 million MT of iron content in 2022, up marginally from 57.5 million MT and 34.5 million MT in 2021, respectively.
Champion Iron is one company producing iron ore in the country. It owns and operates the Bloom Lake complex in Quebec. Champion ships iron concentrate from the Bloom Lake open pit by rail, initially on the Bloom Lake Railway, to a ship loading port in Sept-Îles, Québec. A Phase 2 expansion, which entered commercial production in December 2022, has increased capacity from 7.4 million MT per year to 15 million MT per year of 66.2 percent iron ore concentrate.
Source: Investing News Network
