Engineering & Mining Journal

NOV 2012

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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IRON ORE REVIEW China to Catch its Breath China, the world's largest buyer of iron ore, will continue to drive and dominate the market for the foreseeable future, even as its economic growth rate shows signs of mild deceleration Iron Ore Review 2012: Waiting for By Magnus Ericsson, Anton Löf and Olle Östensson With the world economy and industrial pro- duction recovering slowly, mainly in emerg- ing countries but also in parts of the OECD (Organization for Economic Cooperation and Development) membership, world crude steel production rose from 1,430 million mt in 2010 to 1,527 million mt in 2011, an increase of 6.8%. World crude steel production in 2011 was well above the peak reached in 2007. China again accounted for most of the increase in production, although both Europe and North America showed some growth. Crude steel production in China increased by 8.9%— from 639 million mt to 696 million mt, a lower growth rate than the 10.7% achieved in 2010. In Europe, production rose by 3.9% but was still below that of 2008. Africa experienced a severe decrease of 20%, mainly related to power shortages in South Africa. In the Americas, production grew by 7.5%—still less than the level reached in 2008, before the financial crisis. Monthly world crude steel production regained its pre-crisis peak by May 2010. This was, however, almost entirely due to China, where production started rising again in November 2008 and previous peaks in monthly production were regained by April 2009. The rest of the world had still not reached pre-crisis production rates in April 2012. Growth rates in most of the OECD area are likely to be modest over the next few years. Ore Production Up Globally In 2011, the world iron ore market contin- ued to grow after the recovery from the recession in 2009 and an all-time high was reached at 1,922.5 million mt, some 4.7% higher than in 2010, with produc- tion of 1,836.1 million mt (See Table 1). Output increased in most regions and countries except in Europe, where the mar- ket was stagnant, including the CIS coun- tries. Oceania experienced the highest growth rates, approaching 12.6%. Among the major producers Australian, Brazilian and Chinese production increased by 12.7%, 5.1% and 2.1% respectively. Indian production decreased somewhat to an estimated 196 million mt, down 7.5%. Production in the CIS countries fell slight- ly by 0.5%. ArcelorMittal's Kryviy Rih operations is the largest steelmaker in Ukraine, with more than 37,000 people working across its steel and mining operations. (Photo courtesy of ArcelorMittal) 42 E&MJ; • NOVEMBER 2012 Chinese production, on a comparable grade basis, was 321.9 million mt, or 16.7% of total world production in 2011, www.e-mj.com

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