Recovering Asian demand for iron ore helped Rio Tinto set new production records in 2010 with fourth-quarter output at 65m tonnes.
The smaller Australian miner Fortescue Metal Group reported fourth-quarter exports at 9.9mt, which has sold for an average cost and freight price of $150 per dry tonne. Rio Tinto did not say how much of its iron ore, which is now based on quarterly prices, was sold on a delivery basis. Rival miner BHP Billiton has yet to report its production results.
The data from Australia came as iron ore prices on the spot market continued their month-long gain, hitting $181.40 per tonne yesterday, according to The Steel Index. The price is calculated for iron ore with an iron ore content of 62%, landed in China. That implies an fob price of Australian iron ore of $174.87 per tonne, and Brazilian iron ore at $163.02 per tonne, The Steel Index said.
Iron ore prices on the spot market hit a 2010 high of $186.50 on April 21, 2010, with average January 2011 prices now 27% higher than November, 2010. The rise comes as the freight rate to ship the iron ore to destinations in China has hit two-year lows.
The iron ore seaborne trade, which totalled nearly 1bn tonnes in 2010, is a key driver of freight rates for the dry bulk shipping sector, particularly the fleet of just over 1,100 capesize vessels.