West and Central African Iron Ore: A Lesson in the Contestability of the Iron Ore Market

Luke Hurst ()

Trade Working Papers from East Asian Bureau of Economic Research

Abstract: The paper briefly sets out factors behind Chinese demand for iron ore imports and the main features of China’s medium term resource consumption growth path. It then outlines the potential of major iron ore export countries to meet China’s medium term iron ore import demands. The focus of the paper is on the potential of iron ore supplies from west and central Africa to enter the export market over the short and medium terms. To assess this, three export capacity scenarios (low, medium and high risk) are constructed for 17 iron ore mines (over 27 production expansion phases) in west and central African. The results suggest the development of west and central African iron ore has the potential to create significant downward pressure on the price of iron ore exports over the short to medium term. The impact of the excess export capacity on iron ore price is estimated and it suggests that there would be significant knock-on effects for iron ore-centric economies such as Australia and Brazil.

Keywords: iron ore; China; Africa; demand for iron ore; iron ore price; Brazil; Australia (search for similar items in EconPapers)
JEL-codes: L72 O13 Q31 Q37 (search for similar items in EconPapers)
Date: 2012-04
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Citations: View citations in EconPapers (3)

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Related works:
Working Paper: West and Central African Iron Ore: A Lesson in the Contestability of the Iron Ore Market (2012)
Working Paper: West and Central African Iron Ore: A Lesson in the Contestability of the Iron Ore Market (2012)
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