Australia’s iron ore wars may have died down but fierce global competition in the commodity has not, with Brazil this week clocking a new production record, and former Rio Tinto chief executive Tom Albanese starting exports from India after a three-year impasse.
Brazil’s Vale posted a quarterly production record of 88.2 million tonnes for the three months to September, despite pulling marginal tonnes out of the market. Productivity campaigns at its lower-cost operations helped offset the production cuts, edging its output 2.9 per cent higher than the period a year earlier.
Australia’s big two, Rio and BHP Billiton, also continue with their expansions, while Fortescue is running at about 165 million tonnes a year after a rapid three-year expansion.
Depressed iron ore prices have stabilised in recent weeks, trading around $US55 a tonne, after months of wild volatility. Iron ore has averaged about $US60 a tonne this year.
Prices in ‘freefall’
But the London-listed Vedanta, headed by Tom Albanese, said that iron ore prices were in “freefall” after the company this week became the first miner in the Indian mining state of Goa to export iron ore in three years, shipping to China.
India’s paring of its export duty from 30 per cent to 10 per cent in June this year on lower-grade exports of the commodity, has made restarting production profitable for some miners in the state of Goa, even around current prices. Vedanta is lobbying to have that 10 per cent duty cut further.
“Vedanta looks forward to government support to navigate the free fall of iron ore prices,” the company said in a statement.
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