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Iron ore exports hit record levels

AUSTRALIA'S iron ore output and export volumes jumped 8% and 10% respectively in the September qu...

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In the latest Australian Bureau of Agriculture and Resource Economics report, iron ore production was 107 million tonnes in the September quarter, up 8% on the previous quarter, while exports were 98Mt, up 10%.

However, the results were soured by a 26% year-on-year fall in export earnings to $A7.1 billion primarily due to sharp declines in contract prices for iron ore products.

ABARE said export earnings from energy and mineral resources fell by 2% quarter-on-quarter to $30.2 billion, largely the result of a 10% appreciation of the Australian dollar against the US dollar, and lower bulk commodity contract prices.

"Strong demand for iron ore from Japan, the Republic of Korea and China underpinned record export volumes in the September quarter," ABARE deputy executive director Dr Terry Sheales said.

The index of export prices of Australian mineral resources remained steady in the September quarter as higher zinc, nickel and copper export unit values were offset by declines in iron ore, gold and diamond export unit values.

Copper output fell 7% during the quarter to 113,000t as the ramp-up at OZ Minerals' Prominent Hill mine offset falls in production at Aditya Birla Minerals' Nifty mine and Newcrest Mining's Cadia Valley and Telfer operations.

The appreciation of the Australian dollar resulted in the value of copper exports dipping 4% to $1.5 billion.

ABARE said copper production in the December quarter would be impacted by the main haulage shaft incident at BHP Billiton's Olympic Dam mine.

Nickel recorded a 31% increase in export earnings to $833 million in the September quarter while nickel mine production increased 5% quarter-on-quarter to 40,000t.

ABARE said nickel output had been constrained by the number of mines that remain closed following sharp falls in nickel prices in late 2008 and early 2009.

"There is still an estimated 40,000 tonnes of nickel capacity in Australia that is currently out of operation," the report said.

On the gold front, output for the quarter remained unchanged at 55t while refined production gained 14% to 87t.

However, export earnings for the precious metal fell by 13% to $2.7 billion during the quarter on the back of a fall in export volumes and a lower Australian dollar denominated gold price.

Australia's uranium output fell 4% to 2685t in the September quarter following maintenance work and production disruptions at Energy Resources of Australia's Ranger mine.

Meanwhile, mined zinc production dipped 10% quarter-on-quarter to 367,000t, while refined production fell 8% to 122,000t.

Export values fell 4%, largely reflected by lower export volumes and the strong Australian dollar.

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