Nerds of Steel

There has been a lot of news lately about how the largest iron ore producers want to change the traditional yearly contract negotiations with their biggest customers.  If you are trying to follow what’s going on and you need some background on the iron ore market and history, you can get some answers online through the sources below.  All the sources are free except the subscription pricing data described at the end of the post.

Who are the biggest iron ore producers?

USGS (U.S. Geological Survey) publishes the Mineral Commodity Summary on iron ore which lists the output of the largest producing countries and their reserves.  I have already mentioned the publications of the Raw Materials Group and UNCTAD in an earlier post, but RMG also have a good summary of the largest producing companies (as well as a general view of what’s going on) in the abstract describing their report The Iron Ore Market 2007-2009.

How much seaborne trade in iron ore is there?

The Australian Bureau of Agricultural and Resource Economics (ABARE) has a quarterly report called Australian Commodities where it lists the largest importing and exporting countries, describes the current pricing issues, and gives market and pricing forecasts.  Metallurgical coal is also discussed in that document, for those who are interested.

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If you want to understand freight rates, you might first want to go to an industry overview provided by Genco Shipping and Trading Limited It includes a very good description of how different drybulk materials are shipped and what the rates you will find actually mean.

You can find current iron ore and coal freight rates on a webpage provided by metaljunction. By clicking on the world map freight route, and by “viewing the details”, you can in many cases get information on shipper, vessel name, tonnage, loading port, unloading port, etc.

Another site by the shipbroking group Simpson Spence and Young provides graphs of iron ore and coal freight rates for major world routes from January to December 2007

If you are trying to understand the historic freight differential between iron ore shipments from Brazil to China and Australia to China, see a BHP presentation from 2005, slide 15, which shows the differential from August 2001 to February 2005. Slide 16 then shows delivered costs of iron ore into China from February 2002 to December 2004.

Finally, as you probably know, there are two well-know indices of drybulk freight rates, one is from the Baltic Exchange, and the other is from JE Hyde. The Baltic indices are only available to Baltic Exchange subscribers, but you can get both the Baltic indices and the JE Hyde indices if you have a subscription to Metal Bulletin and click on the category “Maritime News”. If you don’t have Metal Bulletin access, you can read the JE Hyde indices levels in the banner on the JE Hyde home page.