Making minerals count

01 Aug 2014
Poured in: Vale is heavily investing in its iron ore facilities

Poured in: Vale is heavily investing in its iron ore facilities

Despite the sensational headlines, ports are capitalising on iron ore potential. John Bensalhia reports

Extra, extra! Read all about it! High stockpiles! Possible strikes! Falling prices!

Iron ore has certainly hit the worldwide headlines in the first half of 2014. It continues to be big news and for good reason. For example, in Australia, iron ore is reported to be the largest source of export revenue, and for the year up to June 2014, forecasters have predicted that the export value is set to rise to A$76.8bn.

But one of the main headline grabbers of recent months has been that of falling iron ore prices – with numbers falling at one point to under US$90 per metric tonne, a figure that hasn't been seen since 2012. A number of global consultancies have been commenting on future price forecasts for iron ore and downgraded iron ore prices for the next year have been predicted by the likes of Wood MacKenzie, Deutsche Bank and Morgan Stanley.

Prospective iron ore prices have been affected by a number of factors including tighter credit conditions, weak Chinese steel prices and high levels of iron ore stockpiles at Chinese ports. A weight of 112.63m tonnes of iron ore was said to be residing at the main Chinese ports in 2014.

Both import and export figures for iron ore have shown recent growth in China. Due in part to the seasonal demands around April time, China's iron ore imports rose by 12.75% from March to 83.39m tonnes. Overall, for the first quarter of 2014, iron ore imports totalled 305.3m tonnes, which was an increase of 21% from the first quarter of 2013. Compared with April 2013, there was also a slight growth in Chinese iron ore exports in April 2014, rising by 0.99%.

 

Strike threat 

In Australia, the iron ore sector has hit the news in more ways than one. A recent ongoing story has been that of the strike threats. Tugboat workers, deckhands and engineers have asking for higher wages and increased leave allowance from Teekay Shipping. Strike action has been threatened, the implications of which could affect iron ore shipments from Port Hedland to China and the Ukraine, and could cost suppliers $94m a day.

With uncertainty over iron ore-related industrial action in Australia, sunnier pieces of news still broke through. The most notable example was Port Hedland's recent announcement of a new record of recent shipments of 1.27m tons of iron ore in just one day, using seven capesize bulk carrier ships. With the welcome news being attributed to a spell of fine weather, this broke the previous record by over 160,000 tons.

On the heels of forecasts of dwindling iron ore prices, this record proved excellent news for the economy. Port Hedland enjoyed a strong Spring season with export growth of 3.55% between April and May. It's expected that the value of iron ore exports will rise from $57.1bn to $76.8bn in 2014 (from a recent report made by the Bureau of Resources and Energy Economics).

A notable milestone in Britain has also been chalked up for SSI UK, which recently reached a milestone with the news that it has exported five million tonnes of steel slab through PD Ports-owned Teesport. In March, the Double Prestige took the five millionth tonne on board as part of a 68,000 tonne shipment in Thailand.

David Varey, general manager, conservancy and port development at PD Ports, Teesport, comments on recent iron ore trends: “In recent years, we have seen a big increase in iron ore imports, which has been entirely driven by SSI UK. In addition to iron ore imports, SSI UK has exported over five million tonnes of steel slab through Teesport's Tees Dock site since the restart in 2012.” The Redcar bulk terminal can handle around five and a half million tonnes of iron ore a year from various origins such as South America and South Africa – as Mr Varey says: “We have seen high levels of iron ore that we haven't seen since 2007.”

The PCI (Pulverised Coal Injection) process has enhanced both production and efficiency, helping to improve blast furnace performance, which is a highly cost-effective way of producing iron for steel manufacturing.

“There has been continual improvement and a big expansion of facilities,” says Mr Varey. “As one of the main UK ports, the handling of iron ore means that we can significantly add to the throughput of our port. Iron ore continues to be a highly significant part of our port cargo mix.”

 

Investment arm

A number of ports and terminals are clearly seeing the bigger picture when it comes to the potential of iron ore. Some have invested in upgrades, facilities and equipment related to iron ore production. One such example is Vale, which has invested in a number of recent new projects, which will help to ensure that its handling of iron ore is as smooth and efficient as possible. Vale enjoyed a strong 2013 with record sales volumes of iron ore and pellets (305.6m t). The company's first quarter report of 2014 showed that iron ore production at Vale reached 71.1m t, which was recorded as the best performance of a first quarter for six years. Furthermore, volumes of iron ore were reported as showing a 4.2% increase over the first quarter of 2013.

The Teluk Rubiah Maritime Terminal and iron ore distribution centre is one such investment, due to be completed by the end of this year. The terminal welcomed a Valemax ship bearing 382,500 tons of iron ore, which, in the meantime will be stored in its distribution centre for future shipment. The Teluk Rubiah terminal will include a deep water jetty and onshore stockyard for handling, blending and customising the iron ore. This will follow on from last year's completion of the Conceição Itabiritos project in Itabria. This boasts a new ore processing facility which can reduce the ore to an appropriately suitable grain size for milling.

Vale is also developing an ambitious project which is said to be the largest iron ore mine project worldwide. The Carajas Serra Sul S11D and CLN S11D initiatives look set to make the most of iron ore potential. The S11D project involves the development of a mine and processing plant in the Southern range of Carajás, Pará. It's estimated that this will have a nominal capacity of 90m tons per year of iron ore. Meanwhile, CLN S11D will invest in both the railway and port – the mined ore will be taken via the Carajás Railway to Ponta da Madeira maritime terminal, which will handle the large increase of iron ore shipments. The initiative will grow the estimated nominal logistics capacity of the Carajás Railway and of Ponta da Madeira maritime terminal to around 230m tonnes/year.

It's investments like these that indicate that there is still great confidence in the iron ore sector. Quite what the headlines will hold for both this year and the coming few years can only be speculated upon, but it's clear that ports and terminals are making the most of that iron ore potential. While the news may grab the immediate attention, with investments into new and/or upgraded facilities and equipment, the ports have their eyes on the bigger iron ore picture.

Innovation in iron ore handling

Investing in the right facilities and equipment is key to getting the best out of iron ore management.

The Port of Quebec bore this in mind when recruiting Seabulk to help upgrade its Beauport Flats terminal. The upgrade included a dynamic new piece of equipment which allows for 4,200 tonnes/hr of iron ore on a 1,500mm wide conveyor belt (as opposed to the old 1,200mm wide belt that allowed for 2,500 tones/hr). In addition, there is a larger shiploader and a bigger bucket wheel stacker reclaimer.

iSam has recently developed a new automated bucket wheel combined stacker reclaimer which not only allows for lower handling costs and an economical handling process of iron ore, it also allows for higher overall throughput rates. No manual handling is needed here, apart from the initial selection of the amount of material required. Once placed in the right location, the combined stacker reclaimer will then get the material with high accuracy thanks to the interaction of the high scan rate of 28000 pixels with an RTK GPS receiver.

Another notable innovation is that of Navtech Radar's SafeGuard anti-collision system, made in conjunction with LogiCamms Ltd. The system was implemented at Pilbara Port, Australia and can elimate the risk of collision between equipment and machines and the risk of injury to staff overseeing operations.

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