SURFACE MINING
Despite cash inflows, iron ore miners see different futures Despite a recent drop in the price of the steel raw material, major iron ore producers are awash in cash and are likely to remain so. Where they disagree is on what they believe will be the next significant profit drivers.
R
io Tinto, the world's largest iron ore miner, reported record first-half profits in 2021, with underlying earnings nearly tripling to USD12.17 billion from the same period a year ago. Despite shipping 12 percent less iron ore in the second quarter than the same period a year ago due to storms affecting Rio's Western Australia state operations, the company's profits soared.
BHP Group and Fortescue Metals Group, Australia's second and third-largest iron ore miners, are expected to join Rio in reporting record profits.
For iron ore delivered in north China, the spot price fell to USD180.15 per ton at the end of July 2021, down 10.5 percent from the previous week.
For the 12 months to end June 2021, BHP reported record full-year iron ore production, despite a slight drop in fourth-quarter output. Fortescue exceeded its full-year iron ore shipment forecast thanks to a record fourth-quarter performance.
However, by historical standards, iron ore is still at extremely high prices, having traded below USD100 per ton from mid-May 2014 to June 2020, with only a brief spike above that level in May and August 2019.
22 | SKILLINGS MINING REVIEW September 2021
