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Iron ore production is surging in the Pilbara, with Port Hedland recording a new tonnage record for the largest departure of ore on a single tide.
The new benchmark of 1,270,721 tonnes was achieved with seven capesize vessels departing on Saturday. This beat the previous record set in April by almost 160,000 tonnes.
Port Hedland Port Authority also said it was the first time seven capesize vessels have sailed on a single tide. The port, Australia’s biggest for iron ore, increased exports by 3.55 per cent between April and May, setting a monthly record of 36 million tonnes.
The news comes amid figures which show that a ramp up in iron ore production was partly to thank for a 1.1 per cent gain in Australia’s economy in the three months to March. Annual growth was a seasonally adjusted 3.5 per cent, the Australian Bureau of Statistics said.
The mining industry made up 80 per cent of this growth. The nation’s three largest iron ore miners BHP Billiton, Rio Tinto, Fortescue Metals Group have all added extra tonnages to their businesses.
It is this ramp up that is being blamed for an oversupply in seaborne supply, and a 31 per cent fall in the price of the commodity which last traded at $US94 a tonne.
However the surge is not expected to end any time soon.
BHP produced around 49 million tonnes of iron ore in the March quarter, but is targeting 69 million for the June quarter.
Fortescue produced 31.5 million in the quarter, and has flagged its intention to up this to 41.6 million tonnes in the June quarter.
Meanwhile, Rio has brought on an expansion of its Pilbara operations two months ahead of schedule, reaching an annual run rate milestone of 260 million tonnes and targeting 360 million tonnes by the end of 2015.
Treasurer Joe Hockey said good weather at the start of this year contributed to the high volume of iron ore leaving Australia.
“It’s an extraordinary quarter in March when you don’t have cyclones, particularly in Western Australia affecting Port Hedland, so our miners are exporting their socks off, and thank God because it’s having a positive impact on our economy,” Hockey said.
The Bureau of Resources and Energy Economics expects the value of iron ore exports to reach $76.8 billion in fiscal 2014, up from $57.1 billion as the extra capacity offsets price falls.
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