AusBN - International demand for Australian iron ore remains as strong as ever, particularly from China, according to data cited by the Commonwealth Bank.
The national bank referred to data released by Pilbara Ports Authority (PPA), which revealred that iron ore shipments from Western Australia’s (WA) Port Hedland grew 7.7% to 42.1 million tonnes (Mt) over the last year.
Port Hedland is located in the Pilbara region of WA and handles iron ore shipments for mining majors including BHP Billiton, Fortescue and Roy Hill Holdings. In 2017, it accounted for around 60% of Australia’s total iron ore exports.
Breaking down the port’s iron ore export throughput by end destination, PPA found that shipments to China grew 11% compared to one year earlier.
China is the end destination for roughly 80 to 85% of all Australian iron ore exports, where it is processed into steel material.
However, Vivek Dhar, mining and energy commodities analyst at the Commonwealth Bank expects Chinese steel demand to grow by just 1.5% in 2018, down from 2.5% last year.
“The risk to our forecast is to the downside, particularly if steel demand dips further lower from China’s property and infrastructure sectors,” he warned.