Australian iron ore shipments were mixed in June, with lump shipments to China hitting a new record, while lower shipments from UK-Australian mining firm Rio Tinto weighed on shipments of fines.
Total iron ore exports were 74.75mn t in June, down from 76.4mn t in May, which was revised slightly from 76.39mn t originally and from the 74.23mn t shipped in June 2018, trade data from the Australian Bureau of Statistics (ABS) show. Shipments to China rallied, with China taking 83.56pc of all Australian iron ore exports, which is the highest proportion of the total since November 2017. China bought a record 14.33mn t of Australian lump in June, up from 12.73mn t in May and from 21.42mn t in June 2018, while its appetite for fines was more in the normal range.
Australia's largest iron ore export terminal of Port Hedland in Western Australia (WA) reported record shipments of 48.92mn t in June, up from 46.2mn t in May and 47.29mn t in June 2018. But the strong performance at Port Hedland, which ships iron ore for BHP, Fortescue and Roy Hill, was offset by lower shipments from Rio Tinto's two WA ports of Dampier and Cape Lambert.
Rio Tinto has struggled to return to sustained strong shipments following Cyclone Veronica in March. The firm may also see a dip in shipments in October when it carries out rail maintenance at its Pilbara operations.
Port Hedland's July export data is due out later this week and will be significantly below the June record, with BHP, Fortescue and Roy Hill all shipping below their June levels, according to early shipping data.
Australia's iron ore fines exports fell to 56.28mn t in June from 58.25mn t in May, which was revised from 58.19mn t and from 56.95mn t in in June 2018.
China accounted for 85.5pc of total fines exports in June with 48.14mn t compared with 48.22mn t in May and 47.89mn t in June 2018. It accounted for 77.5pc of all Australian lump exports, setting a new monthly record of 14.33mn t, breaking the previous record of 13.55mn t set in October 2017. Australian mining firms have been preferring lump production over the past year, with Fortescue boosting lump output since last September.
Fines shipments to Japan fell to 3.19mn t in June from a revised 3.75mn t in May and from 3.33mn t in June 2018. Fines exports to South Korea fell to 3.23mn t in June from 4.04mn t in May and 3.31mn t in June 2018.
Total lump exports broke the record set the previous month to reach 18.47mn t from 18.15mn t in May and up from 16.8mn t in June 2018. Lump exports to Japan fell to 2.45mn t from 2.93mn t in May but were up from 2.27mn t in June 2018.
Total iron ore export receipts reached a record A$9.42bn ($6.54bn) in June, up from A$9.03bn in May — which was previously the highest monthly revenue for iron ore exports — and from A$5.15bn in June 2018, according to the ABS data.
The average ABS export price was $87.50/t in June, up from $82.14/t in May, and the highest monthly level since May 2014 when it averaged $89.10/t. The figures are based on the Australian/US dollar exchange rate of $0.6942 used by the ABS for June. This was the lowest monthly average of the Australian dollar against a US dollar since February 2009 when it averaged $0.6646, according to ABS data.
The average export price for Australian fines was $81.48/t in June from $76.67/t in May and $47.54/t in June 2018. The Argus ICX seaborne fines price for 62pc Fe ore delivered to China averaged $108.69/t in June, up from $99.06/t in May and from $64.45/t in June 2018 and the highest level since the ICX index averaged $113.08/t in April 2014.
