IRON ORE
Iron ore miners bouncing back
Iron ore prices reached a three-month high in January.
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After the iron ore price rode the highest of highs and lowest of lows in 2021, a first quarter recovery has allowed some emerging producers to restart mining operations in 2022.
s if issues of labour shortages and border restrictions weren’t enough of a burden on the Australian mining industry in 2021, the iron ore price decided to have its fun with iron ore miners big and small. And while record prices above the $US230 ($294) per tonne mark were seen in May – before diving to $US180 and rising above $US200 again from June through July – it was a case of too good to be true. Chinese restrictions on steel production wreaked havoc on Australia-China relations, but analysts assured investors and miners alike that the tides would turn and iron ore prices would settle back to usual proceedings. But a mountainous dive was to come, as
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iron ore prices caught up with the curb in steel production and more than halved in the space of two months. From July to September, more than $US130 per tonne was slashed from the going rate and several of Australia’s burgeoning iron ore producers were brought to unfeasible standstills. By mid-November 2021, a secondary dive saw the iron ore price bottom out in the low $80s per tonne and the likes of GWR Group, CuFe, Venture Minerals, Indus Mining and Mount Gibson had all halted mining operations citing iron ore prices. But it wasn’t all doom and gloom for some, as GWR chairman Gary Lyons foreshadowed in September his company was well prepared to outlast the pricing
lull in Australia’s top export. “Whilst it is disappointing that mining operations have temporarily ceased at the C4 iron ore mine, it is important to note GWR remains in a strong position to resume operation as the mine will be left in a production-ready state in order to take advantage of a recovery in iron ore prices,” Lyons said at the time. And outlast they did. By the turn of the new year, the iron ore price had been above $US100 per tonne for more than three weeks and showed few signs of slowing down. Come the week of January 10, GWR was able to recommence mining operations at C4 citing more feasible iron ore prices, while haulage and sales had continued over the holiday period.
