Spending on iron ore exploration in Australia in the third quarter of this year increased by 9.7% year-on-year – to A$216 million ($134.9 million). This is the highest level in a decade, S&P Global reports, citing the government’s quarterly resources and energy review.
According to the report, the latest results show a continuation of the high level of exploration, which was driven by the historic high of iron ore prices in early 2021 (over $200/t) and continued demand.

In particular, Dean de Largy, Managing Director of Australian Critical Minerals, noted that Western Australia continues to focus on this raw material despite some global negativity related to the slowdown in China. The company has several ore mining projects in the Pilbara region.

Australian producers have promising deposits that need to be further strengthened to determine where they are in the future production chain. In addition, explorers remain optimistic about finding new reserves of high-grade iron ore.

Companies that produce high-grade iron ore products have an understanding that they will find a market, regardless of the state of the global economy, says de Larzy. In addition, some of the largest companies are committed to long-term production of medium-grade ore.
Exploration is also being spurred by significant downstream investment in Australia, which needs higher-grade ore to produce DRI and green steel.

However, global decarbonization trends and the start of production at the Simandou project in Guinea in 2026 are likely to contribute to the increase in the seaborne iron ore trade surplus. Combined with the weakness of China’s economy and the current crisis in its real estate sector, which will remain in the near term despite stimulus measures, iron ore prices could fall to an average of $95/t by the end of 2025, predicts Tamara Thorne, senior analyst at Commodity Insights.

• [Editor:Alakay]