Interesting report below. Also, MySteel has all Brazilian exports from 9 ports world wide reversing down for the week 18-24 Jan (the week after the port fire at PdM) to 5.7Mt for the week. That is reasonably low.

Bulk Buys: Sunny outlook stays for iron ore, coal shippers guess on timing of Chinese buyers’ return

Mining

14 hours ago|Mike Cooper

• Iron ore fines prices traded this week at $US165.05 per tonne, down $US5.50 on a week ago
• Hard coking coal prices were $US13.50 higher on-week at $US118.25 per tonne at Queensland ports
• China’s reinforcing bar price is at $US660 per tonne, and steady on a week ago

China-bound cargoes of iron ore stepped down from their nine-year high of $US170.55 per tonne reached last
week to $US165.05 per tonne ($213.50/tonne) this week.

The traded price includes bulk vessel freight costs to destination ports and shipping costs have been rising
partly because of delays in unloading coal cargoes at Chinese ports.

Futures prices for iron ore were trading at a slight discount to physical cargo prices, with theSingapore
Exchange’s February contractat $US162 per tonne, Wednesday.

Market analysts are expecting China’s demand for iron ore to stay robust in 2021, with some anticipating further
price rises for the steel-making ingredient.

“Five years of mining sector deleveraging and capital discipline from 2015-2020 and a lack of high-quality
greenfield projects across most commodities sets this next cycle up as more of a supply-side driven rally
as global demand recovers from the COVID-19 pandemic,” analysts at US investment bank Goldman Sachs said.

Shipments of iron ore from Australia’s north west ports have been running at record levels recently in the absence of any disruption from severe weather events such as cyclones.

A potential tropical cyclone that appeared to be forming off WA’s Pilbara coast last week failed to materialise
and was downgraded to a low pressure storm at the weekend.

Some flooding and road closures were expected in the Pilbara region from the storm which passed by without any significant impact.

In the 2020 year, 874.2 million tonnes of iron ore was shipped from WA’s Pilbara ports, up 3 per cent on 2019’s
volume of 849 million tonnes.

BHP and Rio Tinto target higher ore shipments in 2021

Rio Tinto (ASX:RIO)is forecasting higher shipments of its Pilbara iron ore product in 2021 of between
325 million to 340 million tonnes, according to its latest production report.

This indicates a rise of up to 9 million tonnes at its upper forecast range on the 331 million tonnes of iron ore
Rio Tinto shipped in 2020.

“First ore from the Robe River joint venture sustaining production projects (West Angelas C, D and Mesa B, C
and H at Robe Valley) is still expected in 2021,” the company said.

Adding: “Gudai-Darri (formerly Koodaideri project) progress continues with production ramp-up on track for early
2022.”

Approximately 30 per cent of iron ore sales for Rio Tinto were on a free-on-board price basis, and 70 per cent
were sold on a delivered basis that included freight costs.

BHP (ASX:BHP)also made record shipments of iron ore in the 2020 year of 288 million tonnes, according to
its latest operations report released last week.

The iron ore producer has reiterated its production guidance for the June 2021-ended financial year at between
276 million and 286 million tonnes.

“Production in the March 2021 quarter is expected to be impacted by planned ore handling plant maintenance
across the mines and continued Mining Area C and South Flank tie-in activity,” said BHP.

The company restarted in December pellet production in Brazil operated by its Samarco joint venture with
Brazilian miner Vale, and is expected to add up to 8 million tonnes of annual production capacity.

Earnings sensitivity model for key ASX iron ore companies showing effect of a 10 per cent change in iron ore prices on earnings. Image: Morningstar

Iron Road to produce pellets product using green hydrogen

ASX iron ore company,Iron Road (ASX:IRD),is developing a green hydrogen project for iron ore pellet
production in South Australia’s proposed Cape Hardy port.

The project could serve as a prototype for green hydrogen projects in Australia’s iron ore sector as it moves
from the drawing board and into reality over the next few years.

Hydrogen Utility (H2U), a developer of green hydrogen projects in Australia, is a partner in the project, as is
Japanese engineering and technology company Mitsubishi Heavy Industries.

The company’s chief executive Larry Ingle told*about the project andthe reasons underlying
Iron Road’s investment in green hydrogen.

Iron Road is in good company when it comes to using hydrogen in its production process, asFortescue
Metals Group (ASX:FMG)and GFG Alliance are following a similar path.

FMG’s chairman Andrew Forrest outlined his company’s plans for zero-carbon steel production in a
groundbreaking speech at the weekend that was televised on ABC TV.

FMG plans to have Australia’s first green steel pilot plant up and running in WA’s Pilbara region in the next
few years. It will be powered by green electricity, both wind and solar.

Fellow billionaire industrialist Sanjeev Gupta and his GFG Alliance group plan to produce green steel in a
modern facility at theWhyalla steelworksin South Australia that will initially run on natural gas, and later
hydrogen.

ASX iron ore company share prices

ADY	Admiralty Resources.	0.015	-12	15	150	$ 17,387,020.49
AKO	Akora Resources	0.45	6	27	0	$ 23,576,205.33
CIA	Champion Iron Ltd	5.58	3	14	109	$ 2,783,964,490.93
EUR	European Lithium Ltd	0.086	-14	83	-5	$ 61,107,141.23
FEX	Fenix Resources Ltd	0.24	-8	9	329	$ 117,965,619.20
FMG	Fortescue Metals Grp	23.83	-4	1	91	$ 77,897,812,425.40
FMS	Flinders Mines Ltd	1.37	38	36	11	$ 204,306,778.17
GRR	Grange Resources.	0.36	14	24	47	$ 428,215,318.26
LCY	Legacy Iron Ore	0.033	-6	-3	1550	$ 206,158,871.06
MAG	Magmatic Resrce Ltd	0.15	-9	-12	-42	$ 28,065,474.72
MGT	Magnetite Mines	0.023	64	77	515	$ 59,983,416.36
MGX	Mount Gibson Iron	0.905	-7	-3	-4	$ 1,162,198,834.44
MIN	Mineral Resources.	37.57	-2	5	116	$ 7,325,126,938.84
SRK	Strike Resources	0.25	19	67	372	$ 63,019,238.34
TI1	Tombador Iron	0.086	-14	41	294	$ 62,519,792.16

Steel rebar prices in China steady ahead of Lunar holiday

Steel reinforcing bar (rebar) has steadied this week in the Chinese market at $US660 per tonne and is off from
its peak of $US700 per tonne in early January.

Used in construction and infrastructure projects, rebar is a critical steel component and for this reason its price
is carefully monitored by industry analysts.

On the London Metal Exchange, prices for its rebar contract for month-ahead delivery peaked around $US660
per tonne in early January.

They were trading at $US630 per tonne this week on the LME, and some market participants suggest their
downtrend may continue as construction in China slows for mid-February’s Lunar New Year holiday.

The adjustment in product prices for steel rebar will not be encouraging for Chinese steel producers trying to
balance higher input costs in terms of iron ore.

But higher iron ore prices may be here to stay for some time, according to mining analysts who published
price outlooks for the commodity this week.

“Buoyant iron ore prices and positive leading indicators (such as relatively low port stocks and positive steel
margins) underpin our bullish stance on iron-ore exposure,” analysts at Macquarie bank said in a research note.

The bank’s analysts highlightedChampion Iron (ASX:CIA), Fortescue Metals Group,Deterra Royalties (ASXRR),Mineral Resources (ASX:MIN)andMount Gibson Iron (ASX:MGX)as ASX iron stocks to watch.

Steel rebar prices have softened as reflected in the LME’s futures contract. Image: LME

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