The hottest vale disrupts the competition of Austr

Vale disrupts the competition of Australian iron ore giants in China

vale disrupts the competition of Australian iron ore giants in China

China Construction machinery information

just as Australian mining companies Rio Tinto and BHP Billiton expand their iron ore exports to China, they will face the counterattack of vale of Brazil, and this market competition is likely to further depress the already depressed iron ore price

the two Australian iron ore companies are expected to report a substantial increase in iron ore production - Rio Tinto announced a 9% increase in production in the second quarter on Thursday. BHP Billiton is also expected to report robust production growth on July 22. With the decline in prices eroding profit margins, the two giants are competing to support exports to boost profits

now, they have to face more fierce competition from vale. The world's largest iron ore enterprise has been approved by China to allow its large ore ship "valemax" to enter Chinese ports for unloading, thereby reducing freight costs

each "valemax" ore ship can transport 400000 tons. These 34 ships are the largest bulk fleet in the world, twice the size of the fleet used by Rio Tinto and BHP Billiton. However, the ban on entering Chinese ports severely limits the cost efficiency of such large-scale vessels

"in this case, BHP Billiton and Rio Tinto have been seeking to increase the carrying capacity and maximize the benefit per ton of ore," said jameswil, an analyst at morgansfinancial, when loading the tensile testing machine

"Vale's new ships are launched one after another. With the current price, it will be at full power next quarter, and more ores will be transported out than before."

due to the sharp fall in iron ore prices, many Chinese producers were forced to close down. Until recently, Rio Tinto and BHP Billiton focused on replacing Chinese domestic iron ore producers to strive for market share

in January this year, China imported 242 million tons of iron ore from Australia, accounting for 63.9% of the total iron ore imports, higher than the 58.7% market share of Australian iron ore in the Chinese market in 2014

Brazilian iron ore has lost its market share in China in recent years. In January this year, China imported 71 million tons of iron ore from Brazil, accounting for 18.7% of the total iron ore imports. This is the same as the 14 year level of conditional yield limit or conditional yield strength, but it is lower than 22% in 2012

however, since the end of last year, Vale has re strengthened its relationship with China

vale should also have a superior grounding installation intention to sell at least eight valemax ships to Chinese companies, and then lease them back for use. In addition, Vale is allowed to berth in Chinese ports, ending the three-year ban. Industry insiders estimate that this will help it save $per ton of freight

vale also finalized a US $16.4 billion expansion plan in June, and Chinese institutions will provide about US $4billion financing support for the plan, enabling BHP Billiton to produce an additional 90million tons of high-quality, low-cost iron ore shipped to China

recently, Vale is replacing the high-cost iron ore production line with a lower cost new production line with a capacity of 25million tons, while maintaining the production target of 340 million tons this year, and reducing the breakeven price

"in the recent iron ore price war, China negotiated directly with vale, a Brazilian giant, to establish another supply channel, which surprised many people," said joseblanco, chairman of the Australian Latin American Chamber of Commerce

vale plans to increase its production capacity by 36% to 450 million tons in 2018, which is significantly more than the total amount of additional supply that BHP Billiton and Rio Tinto plan to provide to the market. The expansion pace of the "two expansions" is beginning to slow down

"China obviously wants to seek balance, the competition between the two largest suppliers intensifies, and BHP Billiton, which has higher logistics costs, wants to reduce costs, which will help the iron ore industry reduce the cost curve," said Xia Junyan, an analyst at Everbright futures

output growth

after the iron ore price fell to a 10-year low of nearly $44 per ton last week, it has only rebounded slightly, holding at $50.10. At $44, only large low-cost miners have room for profit

Australian miners are currently producing iron ore at full speed

Australia's port export data showed that the export volume of iron ore from Hedland port to China in the quarter of last month increased by 32% over the same period of last year. One fifth of the total global seaborne iron ore is handled by Hedland port

"from our point of view, the focus is on investors' return on capital," said neilboyd Clark, managing director of Arnhem investment management, whose investment management company holds Rio Tinto and BHP Billiton shares

"for these companies that can achieve return on investment through increasing production, this is reasonable," he said

Rio Tinto has vowed to increase production by 16% this year to 350 million tons. BHP Billiton is expected to increase by 2% to 250 million tons

chrisdrew, mining analyst at rbccapital, predicts that BHP Billiton's quarterly production will increase by 11% over the same period last year

"they are saying 'the profits have become less, so let's try our best to produce'," said Wilson of Morgans

link: Rio Tinto revised down its iron ore shipment target for this year

Australian mining giant Riotinto announced on Thursday that it would revise its iron ore shipment target for this year, down from 350million metric tons originally predicted to 340million metric tons, mainly due to the abnormal climate in Western Australia, including the impact of two hurricanes, which affected the iron ore production capacity in the first half of this year. Rio Tinto's iron ore shipments in the second quarter increased by 12% to 81.4 million tons, but not as expected