Iron-Ore Exports Drop at Australia's Port Hedland

   By Rhiannon Hoyle 
 

SYDNEY--Iron-ore exports leaving Australia's largest bulk-commodity port declined last month on weaker shipments to not only China, but other key buyers like Japan.

A total of 33.6 million metric tons of the steelmaking ingredient was shipped through Port Hedland in Australia's northwest in June, down 6.8% from 36.1 million tons a month earlier.

A 720,000-ton, or 2.4%, drop in exports to steel-hungry China helped underpin the slide. China still bought more than 29 million tons of the ore shipped from Port Hedland.

The world's second-largest economy accounts for around 60% of global demand for iron-ore, used to create steel for industries like manufacturing and construction. Iron-ore demand has eased, though, as Chinese steelmakers draw down existing inventories after hitting record crude steel output rates in recent months, analysts say.

Traders have also speculated Chinese imports of the raw material may fall amid an alleged financing scandal, as banks withhold credit and customs officials tighten checks on incoming shipments.

There were fewer cargoes last month destined for Japan and South Korea as well. Shipments to Japan fell to 1.4 million tons from nearly 2.5 million tons, while exports to South Korea dropped to 2.2 million from nearly 3.0 million the month prior.

Mining companies like BHP Billiton Ltd. (BHP), Fortescue Metals Group Ltd. (FMG.AU) and Atlas Iron Ltd. (AGO.AU) use Port Hedland, making it one of the world's largest iron-ore export terminals.

Iron-ore traffic through Port Hedland has risen sharply in recent years as mining companies have raised output at Pilbara. Compared with year-earlier volumes, exports via the port in June were up 21%, with shipments destined for China 27% higher.

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