Maritime iron ore trade down in first four months of 2022 as Chinese demand declines

SIron ore trade has fallen 2% so far in the first four months of 2022 as Chinese demand has not been as strong. In a recent weekly report, shipbroker Banchero Costa noted that “global iron ore loadings in the full 12 months of 2021 increased by +0.7% year-on-year to 1,555.3 million tonnes , according to ship tracking data from Refinitiv. This figure was slightly higher than the 1,526.0 million tonnes in the 12 months of 2019, a year which was affected by the Brumadinho dam disaster. It was, however, still slightly below the all-time high of 1,557.3 million tonnes in the 12 months of 2018. Total iron ore shipments from Australia were down -0.3% year-on-year from January to December 2021, to reach 883.8 million tonnes. On the other hand, total shipments from Brazil jumped +3.8% year-on-year in January-December 2021 to reach 346.9 million tonnes.”

According to the shipbroker, “so far in 2022, iron ore trade has slowed again, mainly due to weaker demand from China. In January-April 2022, global iron ore loadings decreased by -2.0% year-on-year to 477.5 million tonnes, compared to 487.2 million tonnes in the same period of 2021. Exports from Australia increased by +0.6% year-on-year in January-April 2022 to 281.1 million tonnes. , an absolute record for this time of year. Exports from Brazil, on the other hand, have fallen -6.6% year-on-year so far this year to 96.7 million tonnes, from 103.5 million tonnes in the same period last year. last year, although they are still higher than in 2019 and 2020. Brazil now accounts for 20.3% of global iron ore shipments, after 58.9% for Australia”.

Source: banchero costa &c spa

Banchero Costa noted that “the European Union (27) is currently the third largest importer of iron ore in the world, after China and Japan. Europe’s steel industry has long been eclipsed by China and the rest of Asia, and currently Europe accounts for only 8% of global crude steel production and 6% of global iron ore imports. Crude steel production across Europe, including the UK, climbed +14.1% year-on-year to 203.7 million tonnes in 2021, with Germany the biggest producer of European steel, producing 40.1 million tonnes, up +12.3% year-on-year. While last year’s production increases were the result of a rebound from Covid lockdowns in 2020, things still look tough this year due to significant increases in energy costs, which have weighed on factory profitability” .

The shipbroker added that “in the 12 months of 2021, the European Union imported 78.5 million tonnes of iron ore, an increase of +10.4% year-on-year, compared to a minimum of 71.1 million tonnes in 2020. This was, however, significantly lower than the 93.9 million t imported by the EU in 2019, i.e. 97.6 mln t in 2018. In the first 4 months of 2022, activity continued to rebound, with iron ore imports increasing by a further +7.7% year-on-year to 28.4 mln t, compared to 26.4 mln t in January-April 2021. This was almost at the same level as pre-Covid levels of 29.0 million tonnes in January-April 2019 and 30.9 million tonnes in January-April 2018. In terms of individual countries, 35.6% of imports in January- April 2022 were made by the Netherlands (largely due to Rotterdam’s importance as a gateway). German ports accounted for 15.5% of imports in January-April 2022, followed by France with 14.4%, Spain with 8.8%, Italy with 8.5%, Belgium with 4.9 %, Poland with 3.2%.

Source: banchero costa &c spa

Regarding the sources of shipments, the main one remains Brazil, although with lower volumes. Brazil was still the European Union’s largest supplier of iron ore in January-April 2022, accounting for 25.6% of total EU imports. However, shipments from Brazil to the EU decreased by -11.1% year-on-year in January-April 2022 to just 7.3 million tonnes, compared to 8.2 million tonnes in January-April 2021. Shipments from Canada to the EU in January-April 2022 were perfectly stable + 0% year-on-year at 5.6 million tonnes. Canada accounted for 19.7% of EU ore imports in January-April 2022. Shipments from South Africa also fell -6.6% year-on-year in January-April 2022 to 4, 9 million tons. Exports from Norway are up +11.4% YoY to 3.6 million tonnes in January-April 2022. Volumes from Mauritania are up +49.5% YoY to 1 .4 million tons. Shipments from India jumped +1000% to 1.1 million tonnes, compared to just 0.1 million tonnes last year,” Banchero Costa concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide