MercoPress. South Atlantic News Agency

Australia’s conflict with China favours Brazilian iron-ore sales

China consumes more than half globally traded iron ore

Spot iron-ore vessel bookings from Brazil to China jumped to a record in July as Australia suspended spot sales following detentions of Rio Tinto's top sales officials in China, reports Reuters.

Chinese authorities this month detained four employees of Rio Tinto, including its top iron ore salesman in China, Australian Stern Hu, over allegations of stealing state secrets during annual iron ore negotiations.

Vessel bookings from Australia's main iron ore ports to China have collapsed to 12 so far this month from an average of 40 in the second quarter and a record 55 in March, according to fixtures data from freight broker AXSMarine.

Shipments from Brazil, the second-largest iron ore supplier to China after Australia, have surged to a record 31, suggesting China's insatiable demand for overseas ore remained intact to feed its record steel production rates.

Strong demand from China, which consumes more than half the globally traded iron ore, drove spot prices to eight-month highs, with Indian ore leading the rally, boosted by shrinking Australian supplies.

Iron ore prices of benchmark 62% iron content delivered in China rose to 84.4 USD a ton on Tuesday, adding nearly 3 dollars in a week, according to the Steel Index, while another compiler, Metal Bulletin, said prices of 62%iron content delivered in China also rose to 85.80 USD a ton on Tuesday.

China's iron ore imports soared 29% this year to a record 297.2 million tons and imports from Australia, the biggest supplier to China, jumped 43% to 122 million tons.