The scale of the iron ore mining industry is mind-boggling.
Some 95% by weight of all metals production is in the form of steel, and with the exception of scrap feed for the EAF market in the US and Europe, much of that is supplied as iron ore.
No wonder the seaborne iron ore freight market is taken at times as a bellwether for the global economy – the steel produced is consumed in just about every facet of modern life.
Supply of that iron ore, though, is surprisingly concentrated into not just a few major iron ore mining firms, but even within them into a limited number of major deposits around the world – sufficient enough, it should be said, that there are no major supply risks even when (as now) parts of Australia are hit by cyclones or India goes through its monsoon season.
But only standing at the bottom of an open cast mine and looking at the Grand-Canyon-sized-scale of the operation can one appreciate the sheer scale of global iron ore operations. One such example is Vale’s Carajás Mineral Province in the state of Pará in Northern Brazil.
Ironically, US Steel first discovered it when one of their helicopters was forced to land on a hill in the area to refuel in 1967. The first mine, N4E, came on stream in 1985, producing just one million metric tons of iron ore.
Now, Carajás is producing over 110 million tons with plans in place for a massive US$20 billion investment in the new S11D project to bring total output up to 230 million metric tons by 2016, according to Business Media Mining. S11D is said to yield the highest purity, naturally occurring iron ore in the world at 66.48%, and the S11 ore body alone is estimated to comprise over 10 billion tons of ore.