CANBERRA: Iron ore shipments from Australia’s Port Hedland, the world’s largest bulk export terminal, dipped in February as bad weather disrupted operations, but still notched a record in year-to-date volumes amid rising supplies from a mine ramp-up and sustained import demand from China. While last month’s exports eased to 35.7 million metric tons from 36.6 million in 2016, over the first two months they were 76 million tons, from 70.4 million in the same period in 2016 and 72.5 million in 2015, according to a statement from the Pilbara Ports Authority, or PPA, and Bloomberg calculations.
Iron ore soared in 2016 as Chinese steel demand held up and the country imported unprecedented volumes, surprising bears who had focused on a jump in supplies and foresaw a retreat in prices. This year the commodity’s risen further, hitting levels last seen two and a half years ago, even with port stockpiles in China at all-time highs. While Barclays Plc and Citigroup Inc. have warned of a drop, AMP Capital Investors Ltd. flagged the possibility of the rally extending to $100 as state support propels China’s steel appetite.
“The consensus seems to be that the steel industry is in good shape,” said Philip Kirchlechner, director of Iron Ore Research Pty and former marketing head at Fortescue Metals Group Ltd. “It’s not so surprising in a way that it’s a record, given that last year China had a record import volume,” he said, referring to the two-month period for Hedland, and China’s 2016 buying. Ore with 62 percent content in Qingdao added 0.1 percent to $89.80 a dry ton on Tuesday, according to Metal Bulletin Ltd. Prices rallied to $94.86 on Feb. 21, the highest since August 2014, and the commodity is up 14 percent this year.
