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Saturday, January 1, 2011

Iron ore, Magmatic magnetite ore, Hematite ore, production and consumption, Iron ore market

By Wikipedia, the free encyclopedia
Iron ores are rocks and minerals from which metallic iron can be economically extracted. The ores are usually rich in iron oxides and vary in color from dark grey, bright yellow, deep purple, to rusty red. The iron itself is usually found in the form of magnetite (Fe3O4), hematite (Fe2O3), goethite (FeO(OH)), limonite (FeO(OH).n(H2O)) or siderite (FeCO3). Hematite is also known as "natural ore", a name which refers to the early years of mining, when certain hematite ores containing up to 66% iron could be fed directly into iron-making blast furnaces. Iron ore is the raw material used to make pig iron, which is one of the main raw materials to make steel. 98% of the mined iron ore is used to make steel.
Indeed, it has been argued that iron ore is "more integral to the global economy than any other commodity, except perhaps oil”.
SourcesMetallic iron is virtually unknown on the surface of the Earth except as iron-nickel alloys from meteorites and very rare forms of deep mantle xenoliths. Although iron is the fourth most abundant element in the Earth's crust, comprising about 5%, the vast majority is bound in silicate or more rarely carbonate minerals. The thermodynamic barriers to separating pure iron from these minerals are formidable and energy intensive, therefore all sources of iron used by human industry exploit comparatively rarer iron oxide minerals, the primary form which is used being hematite.
Prior to the industrial revolution, most iron was obtained from widely available goethite or bog ore, for example during the American Revolution and the Napoleonic wars. Prehistoric societies used laterite as a source of iron ore. Historically, much of the iron ore utilized by industrialized societies has been mined from predominantly hematite deposits with grades in excess of 60% Fe. These deposits are commonly referred to as "direct shipping ores" or "natural ores". Increasing iron ore demand, coupled with the depletion of high-grade hematite ores in the United States, after World War II led to development of lower-grade iron ore sources, principally the utilization of taconite in North America. Lower-grade sources of iron ore generally require beneficiation. Magnetite is often utilized because it is magnetic, and hence easily separated from the gangue minerals and capable of producing a high-grade concentrate with very low levels of impurities. Due to the high density of hematite relative to associated silicate gangue, hematite beneficiation usually involves a combination of crushing, milling, gravity or heavy media separation, and silica froth flotation. One method relies on passing the finely crushed ore over a bath of solution containing bentonite or other agent which increases the density of the solution. When the density of the solution is properly calibrated, the hematite will sink and the silicate mineral fragments will float and can be removed.
Iron ore mining methods vary by the type of ore being mined. There are four main types of iron ore deposits worked currently, depending on the mineralogy and geology of the ore deposits. These are magnetite, titanomagnetite, massive hematite and pisolitic ironstone deposits.
Magmatic magnetite ore depositsOccasionally granite and ultrapotassic igneous rocks segregate magnetite crystals and form masses of magnetite suitable for economic concentration. A few iron ore deposits, notably in Chile, are formed from volcanic flows containing significant accumulations of magnetite phenocrysts. Chilean magnetite iron ore deposits within the Atacama Desert have also formed alluvial accumulations of magnetite in streams leading from these volcanic formations.
Some magnetite skarn and hydrothermal deposits have been worked in the past as high-grade iron ore deposits requiring little beneficiation. There are several granite-associated deposits of this nature in Malaysia and Indonesia.
Other sources of magnetite iron ore include metamorphic accumulations of massive magnetite ore such as at Savage River, Tasmania, formed by shearing of ophiolite ultramafics.
Another, minor, source of iron ores are magmatic accumulations in layered intrusions which contain a typically titanium-bearing magnetite often with vanadium. These ores form a niche market, with specialty smelters used to recover the iron, titanium and vanadium. These ores are beneficiated essentially similar to banded iron formation ores, but usually are more easily upgraded via crushing and screening. The typical titanomagnetite concentrate grades 57% Fe, 12% Ti and 0.5% V2O5.

Hematite ore
Hematite iron ore deposits are currently exploited on all continents, with the largest intensity in South America, Australia and Asia. Most large hematite iron ore deposits are sourced from altered banded iron formations and rarely igneous accumulations.
Hematite iron is typically rarer than magnetite bearing BIF or other rocks which form its main source or protolith rock, but it is considerably cheaper to process as it generally does not require beneficiation due to its higher iron content. However, Hematite ores are harder than magnetite ores and therefore require considerably more energy to crush and grind if benefication is required. Hematite ores can also contain significantly higher concentrations of penalty elements, typically being higher in phosphorus, water content (especially pisolite sedimentary accumulations) and aluminium (clays within pisolites). Export grade Hematite ores are generally in the 62–64% Fe range.

Production and consumption
Iron is the world's most commonly used metal - steel, of which iron ore is the key ingredient, represents almost 95% of all metal used per year.[2] It is used primarily in structural engineering applications and in maritime purposes, automobiles, and general industrial applications (machinery).
Iron-rich rocks are common worldwide, but ore-grade commercial mining operations are dominated by the countries listed in the table aside. The major constraint to economics for iron ore deposits is not necessarily the grade or size of the deposits, because it is not particularly hard to geologically prove enough tonnage of the rocks exist. The main constraint is the position of the iron ore relative to market, the cost of rail infrastructure to get it to market and the energy cost required to do so.
Mining iron ore is a high volume low margin business, as the value of iron is significantly lower than base metals. It is highly capital intensive, and requires significant investment in infrastructure such as rail in order to transport the ore from the mine to a freight ship. For these reasons, iron ore production is concentrated in the hands a few major players.
World production averages two billion metric tons of raw ore annually. The world's largest producer of iron ore is the Brazilian mining corporation Vale, followed by Anglo-Australian companies BHP Billiton and Rio Tinto Group. A further Australian supplier, Fortescue Metals Group Ltd has helped bring Australia's production to second in the world.
The seaborne trade in iron ore, that is, iron ore to be shipped to other countries, was 849m tonnes in 2004.[6] Australia and Brazil dominate the seaborne trade, with 72% of the market.[6] BHP, Rio and Vale control 66% of this market between them.
In Australia iron ore is won from three main sources: pisolite "channel iron deposit" ore derived by mechanical erosion of primary banded-iron formations and accumulated in alluvial channels such as at Pannawonica, Western Australia; and the dominant metasomatically-altered banded iron formation related ores such as at Newman, the Chichester Range, the Hamersley Range and Koolyanobbing, Western Australia. Other types of ore are coming to the fore recently, such as oxidised ferruginous hardcaps, for instance laterite iron ore deposits near Lake Argyle in Western Australia.
The total recoverable reserves of iron ore in India are about 9,602 million tones of hematite and 3,408 million tones of magnetite[citation needed]. Madhya Pradesh, Karnataka, Bihar, Orissa, Goa, Maharashtra, Andhra Pradesh, Kerala, Rajasthan and Tamil Nadu are the principal Indian producers of iron ore.
World consumption of iron ore grows 10% per annum[citation needed] on average with the main consumers being China, Japan, Korea, the United States and the European Union.
China is currently the largest consumer of iron ore, which translates to be the world's largest steel producing country. It is also the largest importer, buying 52% of the seaborne trade in iron ore in 2004. China is followed by Japan and Korea, which consume a significant amount of raw iron ore and metallurgical coal. In 2006, China produced 588 million tons of iron ore, with an annual growth of 38%.

Iron ore market
Over the last 40 years, iron ore prices have been decided in closed-door negotiations between the small handful of miners and steelmakers which dominate both spot and contract markets. Traditionally, the first deal reached between these two groups sets a benchmark to be followed by the rest of the industry.
This benchmark system has however in recent years begun to break down, with participants along both demand and supply chains calling for a shift to short term pricing. Given that most other commodities already have a mature market-based pricing system, it is natural for iron ore to follow suit. Although exchange-cleared iron ore swap contracts have developed over the past few years, to-date no exchange has established a proper futures market for the largely seaborne $88 billion a year iron ore trade. To answer increasing market demands for more transparent pricing, the pan-Asian multi-product commodity and currency derivatives exchange for global trade Singapore Mercantile Exchange (SMX) is planning to launch soon an iron ore futures contract, subject to regulatory approval from the Monetary Authority of Singapore, based on the Metal Bulletin Iron Ore Index (MBIOI) which utilizes daily price data from a broad spectrum of industry participants and independent Chinese steel consultancy and data provider Shanghai Steelhome's widespread contact base of steel producers and iron ore traders across China.
This move follows a switch to index-based quarterly pricing by the world's three largest iron ore miners - Vale, Rio Tinto and BHP Billiton - in early 2010, breaking a the 40 year tradition of benchmark annual pricing.

MoEF defers clearance to JSW's Rs 25k-cr Bellary unit expansion

The environment ministry is believed to have deferred clearances to JSW Steel’s Rs 25,000-crore capacity expansion proposal at Bellary plant and sought details of coal linkage and disaster management plans among other things.“After detailed deliberations, the committee (expert appraisal panel of Ministry of Environment and Forests) ... deferred the project,” sources said.
Sajjan Jindal-led JSW Steel is producing seven million tonnes per annum (mtpa) steel at Bellary now and has embarked on expansion to take the capacity to 10 mtpa, expected to go on stream by March next year.JSW Steel also plans to further increase its steel making capacity within the plant to 16 mtpa by 2013. The environment ministry’s clearance was sought for expanding capacity from 10 mtpa to 16 mtpa.Mecon, which has been roped in by JSW Steel as consultant for the proposed expansion, had made a detailed presentation on the project and outlined environmental protection measures to be taken at a recently-held meeting with the designated panel of the environment ministry, sources said.However, not satisfied with the information provided by the steel major, the panel has asked detailed housing plan for construction workers, exact source and trace element analysis of raw material, a copy of coal linkage document and CSR plan for five per cent of the project cost.The expert committee has also asked for an authenticated map showing the location of the project and Daroji Bear Sanctuary.

Courtsey news via Press Trust Of India / New Delhi December 31, 2010, 1:07 IST
Tags : environment ministry, MoEF, JSW Steel, sisaster management, Sajjan Jindal

Companies & Industry, commodities; JSW top bidder for Bellary Steel & Alloys

Close on the heels of bagging Ispat Industries, Sajjan Jindal-controlled JSW Steel has emerged the highest bidder for debt-laden Bellary Steel & Alloys.
There is, however, a twist: Sesa Goa, India’s largest producer and exporter of iron ore in the private sector, was told in the morning that it had emerged the only qualified bidder when the tender was opened.“By afternoon, we were informed there was another bid from JSW, which was higher,” Sesa Goa Managing Director P K Mukherjee said.While Sesa Goa’s bid was marginally higher than the Rs 205.63-crore reserve price at Rs 206 crore, JSW’s bid came in at Rs 210 crore. JSW did not comment on the development.Sesa Goa was then asked to participate in inter se bidding, which the company declined. A clause in the tender said inter se bidding would be held among those found eligible and the highest bidder would be declared successful.
“I have been trying to call IFCI, but there has been no response from their side,” Mukherjee said. Bellary was being sold by a consortium of lenders led by IFCI.Bellary Steel has a half-constructed plant, with a rated capacity of 0.5 million tonne. “The plant was never completed and ran into debt,” Mukherjee said. But its biggest asset is 700 acre freehold land.The sale was conducted under the Securitisation & Reconstruction of Financial Assets & Enforcement of Security Interest Act. The SARFAESI Act empowers banks or financial institutions to recover non-performing assets without court intervention.Companies were allowed to bid separately for the land, integrated steel plant and machinery. However, Sesa Goa and JSW submitted composite bids.JSW’s seven-million tonne steel plant is in the Bellary-Hospet region. With Ispat, JSW will become India’s largest steelmaker by March 2011, when its Vijayanagar plant commissions an additional three million tonne, taking its total capacity to 14.3 million tonne. The company has set itself an ambitious target of 34 million tonne by 2020.

Courtsey news via Business Standard by Surajeet Dasgupta / New Delhi January 1, 2011.
Tags : Sajjan Jindal, JSW Steel, Bellary Steel & Alloys, Sesa Goa, P K Mukherjee, SARFAESI Act

Thursday, December 30, 2010

Anglo to invest $770m in Brazil iron ore port with Batista’s LLX

Anglo American Plc, the world’s fifth-largest base-metals producer by market value, agreed to invest as much as 1.3 billion reais ($770 million) in its iron- ore port project with billionaire Eike Batista’s LLX Logistica SA to export the mineral from Brazil.
Under a revised 25-year agreement, Anglo will pay $7.10 for each metric ton of iron ore shipped from the Porto Acu joint venture, LLX said in a regulatory filing yesterday. The accord will generate $190 million of annual revenue for LLX, according to the filing. London-based Anglo owns 49 percent of the port.
Anglo, suffering delays and cost overruns at its Minas Rio development in Brazil, is spending about $17 billion to expand production of copper, iron ore, nickel and other metals as demand from Asian nations grows. The Minas Rio iron-ore complex, its biggest project, includes a mine, a processing plant and a 326-mile (525-kilometer) pipeline that will transport the mineral to Porto Acu.
The company secured a key license from Brazil this month allowing it to progress with building Minas Rio after delays in getting permits and design changes increased costs. It said in July the cost of the development may rise by about a fifth to $4.6 billion because of the delays.
Anglo said Dec. 10 that it will start work on the project in March and deliver its first ore 27 to 30 months after that. It had initially planned to start mining this year.
Anglo rose 1.7 percent to 3,364 pence in London trading at 11 a.m. Before today, it climbed 22 percent this year, less than a 28 percent rally in the FTSE All-Share Mining Index.
News via Bloombert by Alex Emery in Lima at
Tag : Business Exchange, Anglo American Plc. Eike Batista’s LLX Logistica SA, iron ore port

Iron ore stockpiles at major ports in China up slightly- 29 Dec 10

Till the close of last week Dec 24th, the imported iron ore stockpiles at China major ports posted at 72.86 million tonnes up 0.53 million tonnes from last week 72.33 million tonnes, out of which Brazilian ore stockpiles 18.28 million tonnes down 310,000 tonnes, Australian ore inventory 26.73 million tonnes up 60,000 tonnes and Indian ore stock 12 million tonnes up 120,000 from that of last week.

Wednesday, December 29, 2010 10:49
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Wednesday, December 29, 2010

India Minister: Final Decision on POSCO Project by January-End

Courtsey news via The wall street journal by Saurabh Chaturvedi and Satish Sarangarajan
NEW DELHI -- India's Ministry of Environment and Forests will make a final decision on Posco's proposed steel plant in eastern India by the end of January, Environment Minister Jairam Ramesh said Wednesday.
Posco, the world's third-largest steelmaker, signed a pact with the government of Orissa state in June 2005 to build the integrated steel plant. At more than $10 billion, it was billed as the biggest foreign direct investment in India.
But the project, like those of ArcelorMittal and Tata Steel Ltd., has been delayed due to tough forest laws and stiff opposition from local people unwilling to sell their land.
The Korean steel giant's planned investment includes a 12 million metric ton a year steel mill, a captive power plant and a port on about 4,000 acres of land in Orissa's Jagatsinghpur district. Much of that land is in forests.
"We will be able to take a final decision by [the] end of January on the future of POSCO's integrated project in Orissa. The project includes three components; mining, steel making and the development of a port. We are hopeful of a final decision on all three segments," Mr. Ramesh told reporters on the sidelines of a conference.
Earlier Wednesday, local newspaper DNA, citing unnamed sources, reported that the environment ministry had cleared the Posco project.
"These reports are speculative, premature and baseless," Mr. Ramesh said.
A cumbersome regulatory approval process and land acquisition issues have hindered big industrial and infrastructure projects in India. According to the steel ministry, some $80 billion of investment for steel projects is stuck in various stages of the regulatory approval cycle.
The domestic steel industry is concerned about meeting the expected 10% annual growth in demand over the next decade and India's steel imports are rising rapidly. The country needs new plants to help meet the booming demand, particularly from the automobile and construction sectors.
Several foreign steelmakers have tried to capitalize on India's growth prospects, including Japan's Kobe Steel Ltd. and JFE Steel Ltd.
Kobe Steel recently signed pacts with Steel Authority of India Ltd. and Essar Steel Ltd. to explore the possibility of a joint venture, while JFE Steel last year acquired a nearly 15% stake in JSW Steel Ltd.
POSCO has also signed a pact with SAIL to set up a joint venture in India.
Russian steelmaker OAO Severstal has signed an initial pact with iron ore miner NMDC Ltd. to set up an India joint venture in the southern Indian state of Karnataka.
In a report earlier Wednesday, local newspaper DNA, citing unnamed sources, said the ministry had cleared Posco's India project.
"These reports are speculative, premature and baseless," Mr. Ramesh told reporters on the sidelines of a press conference.
Posco signed a pact with the government of Orissa in east India some six years ago to build the integrated steel plant at an investment of about $12 billion.

Tag : Posco, steel plant, Government of Orissa, Ministry of Environment and Forests

Monday, December 27, 2010

Spot iron ore prices unmoved at $175-177 cfr

Courtsey news via Metal Bulletin Ltd.
Shanghai 30 December 2010 08:15
Spot prices for 63.5% Fe Indian fines remained at $175-177 per tonne cfr main Chinese ports on Thursday, December,2010 with most market participants still on the sidelines. Mainstream offers were still unchanged at $176-178 per tonnes cfr.
Courtsey news via Metal Bulletin Ltd.
Spot iron ore prices stable at $175-177 cfr on MondayShanghai 27 December 2010 08:03
Spot prices for 63.5% Indian fines stood unchanged at $175-177 cfr Chinese ports on the first working day after Christmas. Offers from Indian miners for 63.5% fines have reached nearly $180 cfr, while offers from traders stand at around $178 cfr. “Now that iron ore prices have reached...
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Iron Ore-China demand slower, India traders hope for $180/T
Courtsey news via Thomson Reuters, Editing by Ramthan Hussain
Fri Dec 24, 2010 7:57am GMT
China mills curtail buying on uncertain price outlook * India traders hope for $180/T C&F for 63.5 grade next week * Swap market inactive on Christmas eve By Ruchira Singh and Ruby Lian NEW DELHI/SHANGHAI, Dec 24 (Reuters) - Asian iron ore prices were stable on Friday as Chinese mills curtailed purchases, though Indian traders saw more upside on expectations that China may need to stock up in the weeks before the Lunar New Year holidays in February. "There is no major bulk buying going on maybe because it is the end of the year," said Ranjan Chhibba, an iron ore and coal trader in New Delhi. "But because of low availability, prices may stay firm." Offers of Indian ore fines with 63.5 percent iron content held at $177-179 per tonne on Friday, CFR delivered to China, unchanged since the middle of this week, traders said. "It could go up to $180 a tonne next week, but whether it is sustainable or not, will have to be seen," said Dhruv Goel of trading firm SKTC in east India. Two major iron ore indexes stayed at seven-month highs, but moved in different directions on Thursday, reflecting mixed views on the near-term market trend.
The Metal Bulletin Iron Ore Index .IO62-CNO=MB rose 62 cents to $168.59 per tonne on Thursday, while the Steel Index 62 percent .IO62-CNI=SI slipped to $170.7 per tonne.
"Trading has been relatively weak late this week as buyers are waiting for a clearer price trend after the new year holiday," said an iron ore trader in eastern China.
Many steel mills still aim to buy more stocks for holiday consumption, while the tightening capital crunch has curbed big purchases for materials already sitting at ports, traders in China said.
"Steel mills are facing a dilemma -- they don't have much money to buy spot materials, but they also don't want to take the risk of importing materials at high prices, despite lower capital pressure in buying via letter of credit," said an iron ore trader in Shanghai. The iron ore swap market stayed inactive as it has been for most of this week with may traders on holidays, and is seen reviving only in the first week of January. The Baltic Exchange's main sea freight index , which tracks rates to ship dry commodities including iron ore, cement, grain, coal and fertiliser, fell to a five-month low of 1,795 points on Thursday as a slowdown in cargo business hit sentiment. [ID:nLDE6BM1J5]