January 2023
AME‘s iron ore 62% spot price averaged US$122/t over 2022, a decrease of 24% from US$161/t in 2021. The 65% and 58% iron ore spot price averaged US$139/t and US$94/t in 2021, down by 25% and 26% year on year, respectively.

Last year was shaped by the recovery from the Covid-19 pandemic and disruptions caused by Russia’s invasion of Ukraine. In 2022, the global iron ore market reached US$160/t in early April due to expected robust restocking demand in China when covid-19 restrictions were lifted.

However, the price gradually dropped to below US$85/t in early November as China’s government was willing to take the economic damage rather than relinquish its zero-Covid strategy.

In addition, China's government has put pressure on steelmakers to maintain crude steel output in 2022 at the 2021 level of 1,035Mt. The slowdown in China’s crude steel output also indicates its resolve to continue reducing annual output in line with its decarbonisation goals. China produced a total of 860.6Mt crude steel during the first ten months of 2022, down 2.2% year on year. Therefore, AME expects China met its crude steel output target in 2022.

The price returned to above US$110/t in mid-December as China lifted the zero-covid policy and the expectations on production resumed among steelmakers. The Chinese government has implied that it will further support the country’s real-estate sector, as the government describes it as a fundamental “pillar” of for its economy growth.

AME expects the Chinese government will further invest in the real estate and infrastructure sectors to boost economic growth. It is estimated that real estate and infrastructure sectors account for ~30% and 25% of steel demand in China, respectively. These sectors have been key to China’s economic growth, but widespread lockdowns have led to lower activity.

Lump and pellet premiums are expected to remain well supported by China's carbon emissions policies. China’s government estimates that carbon emissions will reach their peak by 2030 and will be significantly decarbonised by 2060. Therefore, it is expected that decarbonisation will boost demand for direct feed iron ore products—pellet and lump. Pellet demand in China will be seen to significantly increase as the domestic steel industry tries to lift pellet ratio in blast furnaces to 30% by 2025, up from 17% in 2022.




The Chinese government has established a state-owned enterprise group, China Mineral Resources Group, which has registered capital of RMB20bn (US$3bn). Meanwhile, The China Iron and Steel Association also approved the establishment of a committee for the iron ore industry. The main aims of these measures are to provide more bargaining power and secure stability by reducing external dependence on seaborne markets.

The new organisation is expected to become the largest iron ore buyer who will import iron ore from 2023 on behalf of ~20 of the largest steel companies in China, including steel giant Baowu and Ansteel. The two companies jointly produce over 230Mt of steel a year and are expanding by merging with rivals. That indicates the new company will likely import at least 460Mt of iron ore a year, or more than 40% of the Chinese demand.


Closures and Production Cuts


Pau Branco

French steel pipe maker Vallourec had to suspend its Pau Branco iron ore mine in Brazil for five months from early January of this year as the National Mining Agency (ANM) ordered after a dike at the mine overflowed and cut off a federal highway. The dike overflow was caused by rainfall on 9th January. Operations were partially restarted in May using an alternative waste pile, albeit at lower-than-normal capacity levels. Vallourec estimates that iron ore production from Pau Branco mine in 2022 will be 3.6Mt, compared with 8.1Mtpa in 2021.



Vale’s production guidance in 2022 was revised to 310-320Mt, compared with a previous forecast of 320-335Mt due to heavy rain during the March Quarter in 2022.



Brazilian steelmaker CSN estimates its production and purchase guidance at 34Mt in 2022, down from previous production guidance of 39-41Mt, due to heavy rain during the March Quarter of 2022.



Anglo American’s iron ore production from Minas-Rio operation in Brazil for 2023 to 2025 will drop to 22–24Mt of iron ore in 2023, 24–26Mt in 2024 and 25–27Mt in 2025. The lower production forecast between 2023 and 2024 was primarily attributed to harder, more compact ore, while pipeline inspections will impact 2025 volumes. Anglo American estimates Minas-Rio’s iron ore production in 2022 to be ~22Mt, the low end of an original guidance of 22-24Mt.


Pilbara Operations

Rio Tinto indicated that full year 2022 shipments from Pilbara Operations in Australia to be at the low end of the original 320Mt to 335Mt. This was impacted by rail outage on the Yandicoogina and Gudai-Darri lines.


Yilgarn Hub

Mineral Resources’ iron ore production from Yilgarn Hub in Western Australia is estimated to drop to 8Mt in 2022, down from 10.5Mt in 2021, mainly due to increased operating costs for higher grade products and falling realised prices.


Kumba Operation

Anglo American’s production from its Kumba operation in South Africa will drop to 35–37Mt of iron ore in 2023, 37–39Mt in 2024 and then, increase to 39–41Mt in 2025. the lower production forecast between 2023 and 2024 is mainly due to Transnet constraints on the line from Sishen to Saldanha port.

Anglo American mentioned that it will take a lot of work to get Kumba back to the 41Mt to 43Mt levels previously forecast. Anglo American revised down Kumba's iron ore production in 2022 to 37Mt, from an original 38-40Mt, due to Transnet’s 12-day strike in October.



Australian junior miner CuFe has put its JWD iron ore mine in Western Australia on care and maintenance, amid a drop in iron ore prices and high haulage costs. CuFe said Its iron ore price declined significantly from highs of over US$158/dmt in March to its current level of ~US$82/dmt. The company uses hedging to offset falling prices, but the coverage is ending, resulting in a suspension of mining.



AME estimates that the iron ore production from Ukraine will drop to 40Mt in 2022, from 76Mt in 2021 due to Russia’s invasion. Ukraine’s major iron ore producers, including Ferrexpo, Metinvest and ArcelorMittal, had to reduce production due to logistical issues and high energy costs in 2022. Production recovery and eventual increases are anticipated to be a longer-term prospect.


New Mines


Miralga Creek

Atlas Iron’s Miralga Creek iron ore mine in the Pilbara Region of Western Australia has achieved first iron ore production. The Miralga Creek project is an extension of the Abydos iron ore mine and will employ around 300 workers directly and indirectly.

The Miralga Creek mine is comprised of five open pits and is located 100km southeast of Port Hedland. Atlas expects to extract 8Mt of iron ore from the mine over a period of 4-5 years.



Vedanta has started mining operations at the Bomi iron ore project in Liberia. It had its ground-breaking ceremony at the Bomi mine on 8th June, according to a regulatory filing by Vedanta.

Rio Tinto’s US$3.1bn (A$4.3bn) Gudai-Darri iron ore project, in the Pilbara region of Western Australia, has achieved first iron ore production. The production capacity of Gudai-Darri is 43Mtpa with a mine life of over 40 years. Production output is expected to reach full capacity during 2023.



Rio Tinto’s US$3.1bn (A$4.3bn) Gudai-Darri iron ore project, in the Pilbara region of Western Australia, officially opened on 21st June 2022.

The production capacity of Gudai-Darri is 43Mtpa with a mine life of over 40 years. Production output is expected to reach full capacity during 2023.

Rio Tinto said that its Gudai-Darri mine is the most technologically advanced mine, which utilises a host of new innovations, including the use of robotics for the ore sampling laboratory, as well as for distribution of parts in the new workshop.

The mine also adopts autonomous trucks, trains and drills to a full digital replica of the processing plant which allows teams to monitor and respond to data collected from the plant.

Moreover, Rio Tinto has increased its focus on environmental issues. The mine uses paperless field mobility technology to provide real time data and to eliminate paper base system. Meanwhile, a solar farm will provide one third of mine’s average electricity demand after it is completed in August 2022.


Iron Bridge

Fortescue Metals Group (FMG) has confirmed that production from its Iron Bridge project will start in the March Quarter of 2023, with 1Mt of iron ore concentrate output in fiscal year 2023. The company indicates a 12-to-18-month ramp-up for the project and expects to produce 7–11Mt in fiscal year 2024.



The joint venture between MinRes, Baowu, AMCI and POSCO, has made a final decision to invest in the Onslow iron ore project in Western Australia.

The total investment is estimated at ~ A$3bn (US$2.1bn). The first shipment from the project, located at the western of the Port of Ashburton in the Pilbara region, is expected in December 2023.

Rio Tinto and China Baowu Steel Group have entered into a joint venture to develop the 25Mtpa Western Range iron ore project in Western Australia's Pilbara region. The total investment is estimated at US$2bn, with Rio Tinto contributing US$1.3bn and Baowu US$700m. Rio Tinto and Baowu account for 54% and 46% interest in the project, respectively. Construction is expected to begin in early 2023 with first production anticipated in 2025.



Ansteel Group’s ROM 30Mtpa Xi’anshan iron ore project in Liaoning province has begun construction. The project will require investment of CNY22.9bn (US$3.25bn). In September, the Liaoning government approved the mining licences of Xi’anshan with design to produce ~10Mt of iron ore concentrate, securing the company’s iron ore supply over medium to long term. The Xi’anshan project is expected to be commissioned by 2027.




Middleback Ranges

GFG Alliance has commenced an expansion at its Middleback Ranges magnetite iron ore mine, in Whyalla, South Australia. The production rate will reach 2.5Mtpa with high iron ore content to be fed to DRI processes at the steelworks in Whyalla, or could be exported. In addition, it has produced the first GREENSTEEL pellets from its Whyalla Plant in South Australia. The pellet feed was produced from the company’s Middleback Ranges magnetite expansion operations.


Bloom Lake

Champion Iron has achieved the first iron ore rail freight from the Bloom Lake mine expansion II project in Quebec, Canada. Champion Iron recommissioned the mine in February 2018, starting with the Phase I project that had a nameplate capacity of 7.4Mtpa of 66.2% iron concentrate over a mine life of 21 years. According to a feasibility study released in 2019, The Phase II expansion doubled the nameplate capacity to 15Mtpa with a remaining mine life of 20 years.



Gerald Metals received all approvals to expand its Marampa iron ore mine in Sierra Leone to 7Mtpa, from the current capacity of 2Mtpa. Gerald Metals expects to achieve 7Mtpa by 2023. Marampa mainly produce 65% of iron ore for the export market. The Sierra Leone government owns 10% of the Marampa mine.



Shougang Hierro Peru, a subsidiary of China’s state owned Shougang Corporation, will invest US$1,045m to its Marcona operations in Peru until 2027. The investment includes US$240m to update the iron ore processing plant between 2023 and 2027, US$455m to develop and exploit mines 9, 10 and 5 from 2022 to 2025, and US$250m to expand the Port in ICA during the years 2023 and 2026.


Casa De Pedra

Brazilian steelmaker CSN will invest BRL13.8bn (US$2.6bn) in phase 1 of a project to expand its iron ore production and purchase from third parties by 34Mtpa in 2022 to 68Mtpa in 2027. The phase 1 plan includes various projects, including Itabirito P15 and Itabirito P4+ projects. It also includes the expansion of the company's central iron ore plant, the reconditioning of a tailings dam, and the expansion of the company's Tecar terminal.




Wiluna West C4

GWR Group’s Wiluna West C4 deposit in Western Australia came back full production after restarting in early January 2022. GWR Group idled the Wiluna West C4 deposit in September 2021 due to iron ore price volatility. The mine resumed operation in early January 2022 due to the increase of the 62% Fe iron ore price to ~US$130/t.



Mwelase Mining Eswatini has restart its Ngwenya iron ore mine in Swaziland. The production capacity in the initial stage will be 1.2Mt of ROM ore (Fe grade of 40–44%) over three years. The Ngwenya iron ore mine is located at Bomvu Ridge, northwest of Mbabane and near the northwestern border of Eswatini in Swaziland. The mine was operated by the Indian group Salgaocar between 2011 and 2014. It has been in care and maintenance since September 2014, due to weak seaborne market.


Mergers & Acquisitions


Cadence Minerals completed the acquisition of a 20% interest in the Amapa iron ore project in Brazil from Indo Sino. As a result, the Cadence and Indo Sino joint venture company, Pedra Brance Alliance (PBA), now owns 100% of the equity of DEV Mineração S.A. (DEV). DEV owns the large-scale Amapa iron ore mine, beneficiation plant, railway and private port.

In May 2019, Cadence signed an agreement with Indo Sino for the right to acquire a 27% interest in the Amapa iron ore project over two stages. The consideration of the first stage is US$2.5m for a 20% interest in PBA. The consideration of the second stage of 7% is US$3.5m.



Fenix Resources executed a Deed of Amendment agreement to acquire an extra 30% interest in the iron ore rights of Scorpion Minerals’ Pharos Project in Western Australia. Consequently, Fenix Resources can earn 100% of the iron ore rights by sole funding exploration and resource definition drilling to identify up to 10Mt of iron ore.

In February 2021, the two companies entered into a binding term sheet to transfer a 70% interest in the iron ore rights of the Pharos project to Fenix. The binding term sheet provides for Fenix to undertake exploration activities for iron ore, whilst leaving Scorpion to focus on its gold and PGE Ni-Cu targets within the tenements.

The Pharos Project Tenements cover 640km² in the Murchison region of Western Australia and are contiguous to the tenements comprising Fenix’s flagship Iron Ridge project.



Australian mining company OAR Resources has completed the sale of its Bramfield iron ore project in South Australia to Hoa Phat Group, a Vietnamese-based steelmaker. The total consideration is A$440k (~US$300k) in cash.

OAR believes its other operations, such as its Crown nickel-copper-PGE project in Western Australia and its gold assets, offer better opportunities to increase shareholder returns.

The Bamfield iron ore project is located on the Eyre Peninsula in South Australia. OAR said resources at the project cannot currently be estimated. However, OAR has an aspirational exploration target of between 250Mt and 300Mt with Fe content of 31.8% to 42.4%, based on the extent of magnetic anomalism at the site.



Hawsons Iron signed an agreement with Starlight Investment to acquire a 6.037% interest in the Hawsons iron ore project for A$10m (US$7.1m). The acquisition will give Hawsons Iron 100% control of the project located in the Australian state of New South Wales.

The company said the deal will enhance the decision-making process as well as deliver material flexibility for offtake agreements and project financing options.

In addition, Hawsons Iron has increased the scope of the bankable feasibility study (BFS) for the Hawsons iron ore project to investigate production capacity of 20Mtpa, up from the previous 10Mtpa.

The Hawson’s magnetite iron ore project is located 60km southwest of the mining city Broken Hill, abutting the South Australian border.



Mineral Resources signed an agreement to acquire the iron ore rights at Western Mines Group's Pavarotti project in Western Australia. The deal consideration is A$200k (US$150k) cash, plus 1.25% future production royalty payable.

WMG will retain a 100% interest in all other minerals relating to the Pavarotti project. WMG remains to focus on the Ni-Cu-PGE potential of the project, whilst leaving iron ore to Mineral Resources.

Pavarotti is WMG’s second nickel sulphide project along with the flagship Mulga Tank Ni-Cu-PGE Project. The Pavarotti project comprises exploration licence E77/2478 and exploration licence application E77/2746, covering 12.8km2.

The project is located approximately 50km north-northeast of Southern Cross, in the Southern Cross Domain of the Youanmi Terrane of the Yilgarn Craton, Western Australia.


Midwestern System

Vale sold its Midwestern System, including the Corumbá iron ore mine and logistics system, as the company looks to simplify its portfolio and focus on its main businesses and growth opportunities.

Corumbá is located in the southwest of Brazil, in Mato Grosso do Sul near the border with Bolivia, and far from the mines in the Iron Quadrangle. The mine produced 2.7Mt of iron ore and 0.2Mt of manganese ore in 2021, contributing with US$110m in adjusted EBITDA.


Vivash Gorge

London-listed Alien Metals completed the acquisition of the Vivash Gorge iron ore project in the Pilbara region of Western Australia.

Alien agreed to pay GBP56.5k (US$71.5k) to previous owner, ASX-listed Zenith Minerals Ltd, with further payments subject to certain milestones being reached. Alien has also agreed to grant Zenith an ongoing royalty payment whilst in production of US$1/dwt (Dry Wet Tonne).

The Vivash Gorge iron ore project is located 60km south of the Alien Metals’s Brockman project and only 80km from Tom Price. The project covers ~47km2.


Simandou North

Arrow Minerals has signed a non-binding term agreement to acquire a 60.5% controlling interest in Amalgamated Minerals, a private Singaporean company.

Amalgamated Minerals currently holds a 100% interest in Simandou North iron project in Guinea.

Arrow will issue 81,250k fully paid ordinary Arrow shares for a three-month exclusivity option to Amalgamated. Moreover, Arrow has the potential option to acquire another 33.3% interest in Amalgamated from Ropa Investments (Gibraltar) Limited for 500m fully paid ordinary Arrow shares.

The Simandou North Iron project is an exceptional early-stage project. It consists of exploration permit 22967 and lies at the northern end of the Simandou Range, Guinea.



London-listed Alien Metals has executed a binding put and call option agreement with Windfield Metals to acquire an additional 39% interest in the Hamesley iron ore project in the Pilbara region of Western Australia. After the completion of the acquisition, Alien will directly hold a 90% interest in the project.

Alien will pay total consideration of GBP1.8m (US$2.1m) which consists of a cash payment of GBP60k (US$70.9k) and the issue of 260m ordinary shares at a deemed issue price of GBP0.0067 (US$0.0079) per share. Alien has an 18-month period to exercise the option, although the company intends to action the option earlier.

The Hamesley iron ore project includes the Hancock and Brockman DSO iron ore tenements. Alien currently has a 51% direct interest in the project, with the remaining 49% held by Windfield.


Santa Fe Mining

India’s JSW Steel sold the entire 70% stake of Chile’s Santa Fe Mining to Diego Calvo SpA for the consideration of US$700, due to the uncertain business environment.

JSW Steel owned a 70% stake in Santa Fe Mining through Inversiones Eurosh Limitada (IEL). In 2008, JSW Steel jointly ventured with Chile’s Minera Santa Fe to develop iron ore mines in South America.

Santa Fe holds iron ore exploration concessions across mines in Belavista and Vinita in the Atacama region of North Chile. However, the lease of Bellavista was terminated in 2021.

JSW Steel bought the eight iron ore mining concessions in 2008 for $52m.



Grange Resources has signed a binding agreement with its joint partner, SRT Australia, to re-acquire a 30% interest in the Southdown magnetite iron ore project in Western Australia.

SRT Australia is owned by Sojitz Corporation, a Japanese trading house, and Kobe Steel, a Japanese steelmaker. After the completion of the acquisition, Grange will hold 100% ownership in the Southdown project.

Southdown has the potential to deliver high grade concentrate with low impurities, which would make the product suitable for DR grade iron ore pellets. In February 2022, A pre-feasibility study was completed which optimised the project to identify a reduced-capital development option.

This involves a smaller 5Mtpa concentrate production operation within the constraints of existing mineral resources and ore reserves. This is anticipated to deliver reductions in capital spend from A$2.9bn (US$2.02bn) down to A$1.39bn (US$970bn). This alternative case extends the life of mine from 14 years to 28 years for the western zone, and potentially more than 50 years for the total resource.



Zanaga Iron Ore Company (ZIOC) has completed the acquisition of Glencore’s 50% of interest in namesake iron ore project in the Republic of Congo. As a result, ZIOC holds 100% ownership in the Zanaga project.

ZIOC is targeting development of the iron ore project to 30Mtpa in two stages. The company said that capital and operating cost estimates for the 12Mtpa first stage of the project remain within the guidance provided in 2014.

The initial capital requirement and operating cost for stage one is estimated at US$2.2bn and FOB ~US$32/t, respectively. The capital expenditure for the additional 18Mtpa production, including contingency, could potentially be financed from the cash flows from the stage one operation.