Most of its supplies come from abroad, predominantly from Brazil and Australia. By various estimates, about 60 per cent of China's iron ore is imported from Australia.
Australia still remains by far the top source of iron ore for China, with a 69% share in 2022. Iron ore imports from Australia to China in 2022 increased by +3.4% yo-y to 739.5 mln tonnes, from 715.4 mln t in 2021. Brazil remains in second spot with a 21% share in 2021.
Iron ore is the most important export earner for Australia. Between 2000 and 2020, Australia exported more than $620 billion worth of iron ore to China. In April 2021, the spot price reached the record high of $238 per ton.
Australia is also China's most important supplier. In 2022, China imported 1.107 billion tons of iron ore, and about 65 percent came from Australia, with producers such as Rio Tinto and BHP taking the major share.
Australia exported $154 billion worth of iron ore last year, most of it to China, where it is a key ingredient in making steel and driving Beijing's economic stimulus.
“First, it would mean too big a disruption to the Chinese economy.” Iron ore imports from Australia are worth $85 billion annually, and so far, the agricultural imports hit by China's tariffs and bans are worth just $6 billion, he said. “China would not be able to make up its iron ore needs from other sources.”
Australia has the world's largest estimated reserves of iron ore with 52 billion tonnes, or 30 per cent of the world's estimated 170 billion tonnes.
In 2022, China bought 1.1 billion tonnes of iron ore, 65% of which were from Australia. For Beijing, commodities from Australia are important for its efforts to revive the pandemic-hit economy.
Most of its supplies come from abroad, predominantly from Brazil and Australia. By various estimates, about 60 per cent of China's iron ore is imported from Australia. Domestic production makes up less than 20 per cent of local needs.
Based on publicly available data, JORC Reserves at operating mines are sufficient for approximately 13 years at the 2018 rate of mine production (Table 2). This increases to 26 years if all deposits with reserves are considered (Table 1).
In financial year 2022, the value of iron ore exported from Australia to China amounted to around 116 billion Australian dollars.
The worth of financial assets would fall by one fifth on average, and by one quarter in Australia. An end to trade across a bamboo curtain would hit Australia, since we export more resources to China than anywhere else and we import more goods from China than anywhere else.
The main destination of Iron Ore exports from Australia are: China ($95.7B), Japan ($9.1B), South Korea ($7.92B), Chinese Taipei ($2.65B), and Vietnam ($1.39B). The fastest growing export markets for Iron Ore of Australia between 2020 and 2021 were China ($30.8B), Japan ($4.68B), and South Korea ($3.57B).
China is by far the world's leading iron ore importing country. In 2021, China's iron ore imports amounted to a value of nearly 174 billion U.S. dollars, which accounted for over 70 percent of global iron ore imports that year based on value.
Exporters and Importers
Iron Ore are the world's 13th most traded product. In 2021, the top exporters of Iron Ore were Australia ($118B), Brazil ($46.2B), Canada ($8.31B), South Africa ($7.68B), and Ukraine ($6.83B).
Global iron ore production in 2021 was estimated at 2,537 million tons, with Australia leading as the top producer, accounting for 35% of the total.
China-Australia In 2021, China exported $70B to Australia. The main products that China exported to Australia are Computers ($4.97B), Broadcasting Equipment ($4.09B), and Other Furniture ($1.82B).
Trade and investment
China is Australia's largest two-way trading partner in goods and services, accounting for nearly one third (32.2 per cent) of our trade with the world.
Although iron ore resources occur in all the Australian States and Territories, almost 90% of identified resources occur in Western Australia, including almost 80% in the Hamersley Province, one of the world's major iron ore producing regions.
What are the biggest iron ore companies listed on the ASX? BHP, Rio Tinto and Fortescue Metals Group are the top by market cap. Iron — the world's most commonly used metal — is key for the steel making industry.
Australia is the world's leading producer of bauxite, alumina, rutile and tantalum; the second largest producer of uranium, lead, ilmenite, zircon and lithium; the third largest producer of iron ore, and zinc.
Australia and Brazil are among the world's largest iron ore producers and hold a large portion of the world's iron ore reserves. Australia makes up half of the world's iron ore exports. Brazil exported around 20 percent of the world's total iron exports.
Hematite and magnetite are the best quality and most significant iron ores for steelmaking. Hematite is the most sought-after ore and the preferred raw material in productive steel mills.