rio flags "staggering" iron demand rise

Article in WA Business News.
http://www.wabusinessnews.com.au/article/Rio-flags-staggering-iron-demand-rise?utm_source=DBA&utm_medium=email&utm_campaign=article_click
01-Sep-2011 by AAP
Category:
News

Worldwide iron ore production growth will need to grow by at least 100 million tonnes a year over the next eight years to meet rising demand, Rio Tinto says.

Global iron ore production in 2010 was about 2 billion tonnes.

The mining giant says it is on track to expand its own iron ore production capacity in Western Australia's Pilbara region to 333 million tonnes per annum (Mtpa), from about 225 Mtpa currently.

Rio Tinto said it would also begin exporting from its Simandou iron ore project in Guinea by mid 2015.

The miner last month brought forward the target date to complete the Pilbara expansion by six months to the first half of 2015.

David Joyce, managing director of Rio Tinto Iron Ore expansion projects, said the forecast lift increase in iron ore demand that was projected until 2019/20 was "staggering".

"As markets like China, India, Indonesia, Vietnam and countries in Africa and South America continue to industrialise and urbanise, we will see an increase in demand for better housing, cars, infrastructure and mobile phones," Mr Joyce told the Africa Down Under mining conference in Perth on Thursday.

"The level of metal intensity per capita will increase with this development and urbanisation."

Mr Joyce told delegates, which include several African mines ministers, that many of the continent's nations were well placed to meet demand growth.

Africa's iron ore sector is booming, with Rio Tinto pursuing the Simandou joint venture with Chinalco in Guinea, which will reportedly cost up to $US19 billion ($A17.8 billion) to develop.

Mr Joyce said Rio Tinto had spent about $US1.5 billion ($A1.41 billion) on the project to date.

It is the largest partnership between private enterprise and government in Africa, he said.

"We remain committed to ambitious timeframes of shipping our first tonnes of iron ore by mid-2015 and are working closely with the government and our partners to make this a reality," Mr Joyce said.