Shipping Eyes Brazilian Ore Exports
Following the plunge in dry bulk freight market, shipping companies are banking on increased iron ore exports from Brazil to China and India to shore up freight rates, reports the Hindu Businessline.
Hauling ore from Brazil to China will cost almost double than that from Australia. So in the current situation, ship-owners feel an increased flow of iron ore from Brazil, the world’s second largest producer, could boost the rates, as hauling the ore from there to China cost almost double than that from Australia.
Brazil accounts for almost 25% of the global market share of iron ore’s trade volume. Brazil is home to one of the largest mining companies, Vale S.A.
Brazil’s Ministry of Industry, Development and Foreign Trade had, last month, said iron ore exports from the country had increased by over 17 per cent in December to cross 37 million tonnes (mt), compared with the year-ago month.
Vale increased output is reflected in Brazilian iron ore exports for December. The volumes from Brazil surged to 37.39 million tons in December, which is a huge 44% month-over-month.
Shivakumar, Group CFO of Great Eastern Shipping hoped that Brazil is able to sell their iron ore more competitively than the Australians, because Brazilian iron ore to China is the best possible thing to happen to dry bulk shipping.