South African iron ore exports to EU retreat while China imports more so far in 2022


The South African iron ore trade has had a mixed year so far. During the nine-month period of 2022, the third largest iron ore exporter has increased its shipments to China, while those to the EU have decreased. In its latest weekly report, shipping broker Banchero Costa said that “so far in 2022, iron ore trade has weakened again, mainly due to weaker demand from China and supply issues in Brazil. In January-September 2022, global iron ore cargoes decreased by -3.0% yoy to 1,124.7m tonnes, from 1,058.9m tonnes in the same period of 2021, according to vessel tracking data from Refinitiv. Volumes were essentially on par with the 1,126.7 million tonnes shipped in the same period in 2019.

Source: Banchero Costa

According to the shipping corridor, “Australia’s exports increased by +0.2% year-on-year in January-September 2022 to 661.2 million tonnes, also slightly above 2020 levels, and a new record. Brazil’s exports, on the other hand, were down -3.8% year-on-year so far this year to 249.3m tonnes, from 259.2m tonnes in the same period last year, although they were still more higher than in 2020. Demand is weighed down by a weakening economy in China, with the country’s iron ore imports falling -2.2% year-on-year to 789.3m tonnes in the first 9 months of 2022. On the other hand, the European Union is experiencing an (already weakened…) resurgence, with imports rising +1.0% yoy to 63.1m tonnes in the same period. However, imports into Europe are still well below the levels of 2019 (71.4 million tons in the period from January to September of that year) and 2018 (73.2 million tons)”.

Banchero Costa said that “South Africa is the world’s third largest iron ore exporter after Australia and Brazil, with a 3.9% market share. Seaborne iron ore exports from South Africa in the 12 months of 2021 increased by +3.5% yoy to 56.8m tonnes. This was the first uptick after many years of declining volumes. In 2020, South Africa’s iron ore exports decreased by -3.2% yoy to 54.9m tonnes. Already in 2019, South Africa recorded a decrease in exports of -0.5% yoy to 56.7m tonnes from 57.0m tonnes in 2018, which in turn was a decrease of -6.5% yoy from 61.0 million tonnes in 2017. After last year’s rebound, things continued to improve in 2022 as well. In the first 9 months of 2022, South Africa exported 43.4 million tonnes of iron ore, a +2.9 % YoY more than the same period last year, and the highest since 2017.”

“All shipments of iron ore exported from South Africa are loaded at the port of Saldanha Bay. The vast majority (88%) of the volumes are loaded on Capesize vessels, with the rest on Handymax/Supramax. Oddly enough, about half of Handymax’s shipments go to China. Overall, in terms of destinations for South African iron ore exports, little has changed in recent years. Mainland China remains South Africa’s largest iron ore importer, with an overall 52.3% share of Saldanha Bay shipments. Imports to China from South Africa increased +2.3% yoy to 22.7m tonnes in the first nine months of 2022, from a record 22.2m tonnes in the same period in 2021. However, this was still well below the 27.2 million tonnes in January. Sep 2020. The second most important destination for South African ore is the European Union, with a 25.6% share. South African shipments to the EU27 decreased by -2.9% yoy to 11.1m tonnes in the first 9 months of 2022, from 11.4m tonnes in the same period in 2021. This was also well above from 6.8 million tonnes in January-September 2020 and 8.8 million tonnes in January-September 2019. Exports to Turkey increased by +226.3% yoy to 1.1 million tonnes in January -September 2022 from 0.3m tonnes in January-September 2021. Volumes from South Africa to South Korea are up +14.2% yoy to 3.3m tonnes YTD. To India, volumes increased by +60.8% yoy to 0.7m tonnes in Jan-Sep 2022 from 0.4m tonnes in Jan-Sep 2021. To the UK it is -24.8% year-on-year to 0.5 million tons from 0.7 million tons in the same period last year,” concluded Banchero Costa.
Nikos Roussanoglou, Hellenic Shipping News Worldwide


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