In its latest weekly report, shipbroker Banchero Costa said that “2023 has been so far a positive year for global iron ore trade. In Jan-May 2023, global loadings of iron ore increased by +3.1% y-o-y to 620.9 mln tonnes, from 602.2 in the same period of 2022. It is however a shade below the 621.3 mln tonnes loaded in Jan-May 2021, which still represent an alltime record. Exports from Australia increased by +2.6% y-o-y in Jan-May 2023 to 365.7 mln tonnes, easily a new alltime record high. Exports from Brazil also increased by +5.1% y-o-y in Jan-May 2023 to 131.0 mln t from 124.6 mln t in JanMay 2022, but were still below the 132.9 mln t in Jan-May 2021. Demand has been poor everywhere except in Mainland China. Iron ore imports into Japan declined by -11.9% y-o-y in Jan-May 2023 to 36.0 mln t. Volumes into South Korea were down by -13.1% y-o-y to 27.0 mln t. To the European Union imports ended up down -15.0% y-o-y to 29.7 mln tonnes in Jan-May 2023. Chinese imports instead surged by +9.8% y-o-y to 470.1 mln tonnes in Jan-May 2023, a record high.
According to Banchero Costa, “South Africa is the third largest exporter of iron ore in the world after Australia and Brazil, with a 3.5% market share in 2022. All iron ore cargoes exported by South Africa are loaded at the port of Saldanha Bay. The vast majority (88%) of volumes are loaded on Capesize vessels, with the rest on Handymax/Supramax. The country’s exports in recent years have been held back by a lack of freight trains to carry minerals to ports. South Africa’s freight rail capacity has plummeted due to years of underinvestment, with a lack of locomotives, and theft of hundreds of kilometres of copper cable from rail lines, costing coal and iron ore exporters billions of rand in revenue”.
“South Africa’s seaborne iron ore exports in the 12 months of 2021 increased by +3.5% y-o-y to 56.8 mln t. This was the first rebound after many years of declining volumes. Things seemed to continue to improve also in 2022. In the first 9 months of 2022, South Africa exported 43.3 mln t, up +2.9% y-o-y from the same period in 2021, the highest since 2017. However, 4Q 2022 was very disappointing, with just 10.4 mln tonnes shipped in Oct-Dec 2022, down -28.9% y-o-y. As a result, overall shipments from South Africa in Jan-Dec 2022 were only 53.7 mln t, down -5.4% y-o-y from 2021, and indeed the lowest in at least a decade”, the shipbroker said.
Meanwhile, “volumes in Jan-May 2023 were again disappointing, with 23.3 mln t, down -2.2% y-o-y from the same period last year. South African miner Kumba Iron Ore said the amount of ore sent by rail to Saldanha port in 2022 fell by 9%, and a build-up of stockpiles at its mines limited space for further production. Kumba was left with 7.8 million tonnes of iron ore stockpiled at its mines and at the port, up 28% from the previous year, as the lack of trains left commodities stranded. In terms of destinations for iron ore exports from South Africa, things are pretty much as expected. Mainland China is by far the top iron ore importer from South Africa, with an overall 54.7% share of shipments from Saldanha Bay in 2022. Imports to China from South Africa increased by +4.2% y-o-y to 29.4 mln t in the full 12 months of 2022, from a 28.2 mln tonnes in 2021. This however was still well below the 34.4 mln tonnes in Jan-Dec 2020. The second largest destination for South African ore is the European Union, with a 25.7% share. Shipments from South Africa to the EU27 declined by -12.0% y-o-y to 13.8 mln t in the full 12 months of 2022, from 15.7 mln tonnes in 2021. This was however above the 10.2 mln tonnes in Jan-Dec 2020 and the 10.6 mln t in Jan-Dec 2019.
Nikos Roussanoglou, Hellenic Shipping News Worldwide