Brazil: Iron ore exports up 5% while pellet exports down by 35% in CY’20

• Total export volumes at 343.03 mn t, up by 8 mn t y-o-y
• Resumption of operations at Samarco to boost pellet exports in CY’21

Brazil -world’s second-largest iron ore exporter recorded CY’20 export volumes at 343.03 mn t, up by around 8 mn t as against 334.7 mn t in CY’19, according to trade statistics released by Brazil customs. Out of total exports of 343 mnt, share of iron ore was 327.1 mn t (up by 5% y-o-y) and that of pellets was 15.9 mn t (down by 35% y-o-y).

Exports to China up 22% in CY’20

Brazilian iron ore and pellet exports to China were recorded at 248.5 mn t in CY’20, up 22% against 203.8 mn t in CY’19. Malaysia was the second-largest importer at 22.94 mn t followed by Japan at 11.53 mn t, both registering decline in import volumes compared with CY19.

The country recorded a rise in its iron ore export volumes in Dec’20. Export volumes stood at 33.2 mn t in Dec’20, an increase of 14% as against 29.2 mn t in Nov’20, according to trade statistics released by Brazil customs. Exports have increased amid increased Chinese winter restocking demand. The average price of iron ore exported from Brazil for Dec’20 witnessed a slight rise on a monthly basis to $90.5/t, FoB Brazil as against $88.7/t, FoB Brazil in Nov’20.

Outlook – Vale in its recent press release dated 23rd Dec’20 notified the restart of Samarco pellet plant along with restart of operations at Germano, located in Mariana, Minas Gerais and Ubu, located in Anchieta,Espirito Santo, complexes. The operation resumption begins with 7-8 mn t capacity. Thus, Brazil pellet exports are likely to improve in CY’21.

However, Vale expects to produce 315-335 mn t iron ore in CY ’21, largely stable against CY’20. Thus Brazil iron ore export shipments are expected to remain largely stable in CY’21.