• Home
• Foundries
• Suppliers
• Newsletter
  • Content / Conditions
  • FAQ - Frequently Asked Questions
• Business Opportunities
  • Buy (Wanted)
  • For Sale
• Job Market
  • JOB OFFERS (vacancies)
  • RESUME
• News
• Technical Papers
• Events, Fairs, Courses, Training
• Forum

USEFUL LINKS

• Universities
• Associations, Institutes, Reseach Centers.
• Norms and Standards
• Quotations / Prices
• Other Links

Foundry Gate

• About Us
• Advertisement
• CONTACT US

Reuters reported that Australian iron ore miners, key beneficiaries of China's modern day industrial revolution, signaled demand growth was finally slowing in response to Beijing's moves to cool its economy.

BHP Billiton, the world's biggest miner, said it was seeing signs of flattening iron ore demand from China, though for now it was pushing ahead with ambitious plans to expand production.

Mr Ian Ashby, president of BHP's iron ore division, said that "Chinese economy is shifting, it's changing. Steel growth rates will flatten and they have flattened."

Mr Ashby said that China's demand for iron ore, a key steelmaking ingredient, will slow to single digit growth, but the country's annual steel output will still rise by some 60% by 2025.

The news knocked the Australian dollar, which fell a fifth of a US cent to USD 1.0595 right after the comments. The FOREX market is very sensitive to any hint of softening demand in China, given it is Australia's single biggest export market.

Mr Stan Shamu, an analyst at IG Markets, said that "What is concerning is the potential impact of single digit demand growth for iron ore. Iron ore demand from China makes up a bulk of our exports and this will impact terms of trade. This shows that terms of trade are peaking and likely to flatten down the line."

Chinese demand for iron ore has been the driving force behind years of expansion work by the world's biggest mining companies. More than 100 million rural Chinese are projected to settle in towns and cities in the next decade, requiring unprecedented amounts of steel for housing and infrastructure.

Rio, BHP and other big miners have been pursuing a strategy of running at full production and expanding capacity in long life and relatively low cost commodity assets compared to the selling price of ore, banking on squeezing out higher cost producers.

Analysts agreed even single digit growth in Chinese ore demand should be enough to spur miners to push ahead with production expansion plans.