Australian iron ore supply shouldn’t be too disrupted by Cyclone Veronica, unless it floods the mines
Iron ore operations in Australia’s Pilbara region are unlikely to be impacted significantly by Tropical Cyclone Veronica, unless it leads to flooding at mines, says Vivek Dhar, Mining and Energy Commodities Strategist at the Commonwealth Bank.
Here’s a short snippet from a report Dhar released earlier explaining why:
The disruption to seaborne iron ore supply is expected to be around 10 million tonnes, or around 0.6% of seaborne supply, if the ports are shut for five days. A more serious disruption is possible if iron ore mines are flooded in the Pilbara, but that outcome appears unlikely.
Australia is the largest exporter of iron ore worldwide, accounting for about 55% of the seaborne market. The vast majority is shipped from ports expected to be impacted by Veronica.
According to the latest cyclone update from Australia’s Bureau of Meteorology, Veronica is currently located 365 kilometres north northwest of Port Hedland.
Based on the latest models, it’s expected to hit the Pilbara coastline between Port Hedland and Karratha as a category 4 system on Sunday morning in Australia.
Source: Business Insider