Iron ore majors ramp up supply even as China faces challenges
Iron ore is one of the year’s worst performing major commodities, slumping by almost a quarter as China’s property crisis drags on.
Bloomberg reports foot-dragging by the Brazilian government over building of the Area do Meio export terminal at the Port of Itaguai south of Rio de Janeiro is having positive consequences for the country richest businessman.
Eike Batista – number one on MINING.com’s list of the world’s wealthiest miners – will open a terminal built by his MMX mining and infrastructure group to export iron ore in little over six months time, while the state project is at least five years away.
“In a scenario of scarce port assets, the MMX port is very valuable,” an analyst told Bloomberg adding that the port “is the main catalyst for the MMX shares because it means at least doubling the selling price of the company’s ore by having access to the international market.”
Iron ore enjoyed a huge spike on Friday with the price of the commodity jumping over 5% to more than $100 a tonne. The global seaborne iron ore trade is roughly 1 billion tonnes, with most of the ore ending up in China.
The Area do Meio delays are a rare bit of good news for Batista who has seen the value of his holdings plummet this year.
On Friday Batista’s hoard climbed $333 million to $22.3 billion as the six public companies he controls – involved in a range of activities including oil exploration, sports management and shipbuilding – slowly begin to make up for losses suffered on Brazil’s stock market this year.
Batisita started the year as the world’s seventh richest person and his wealth peaked in March shy of $35 billion, but he has now dropped out of the the top 20.
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