Global iron ore production growth to accelerate until 2026 – report

Global iron ore production growth will accelerate in the coming years, bringing an end to the stagnation that has persisted since iron ore prices hit a decade-low average of $55 a tonne in 2015, market analyst Fitch Solutions asserts in its latest industry report.

Continued, albeit slower, growth in Australia, faster growth in Brazil and stabilisation in Mainland China’s ore output will be the main drivers of growth, Fitch says. China will invest heavily in overseas mines to improve security of iron ore import supply, and Guinea will be an important beneficiary of this trend via the Simandou project.  

Fitch forecasts global mine output growth to average 2.7% over 2022-2026 compared to -1.3% over the previous five years. This would lift annual production by 361.7mn tonnes in 2026 compared to 2022 levels, roughly the equivalent of Russia, India, and South Africa’s combined 2022 output.

Supply growth will be primarily driven by Brazil and Australia, while Brazilian miner Vale has aggressive expansion plans, Fitch notes, adding that miners in Australia including BHP, Rio Tinto and Fortescue will reinvest currently buoyant profits into additional production.

In Mainland China, iron ore production will rise once again in the next three to four years as the country works to increase its self-sufficiency and reduce Australian imports, having declined significantly over recent years, the analyst predicts.