MINERAL REVIEW AND FORECAST: FERROUS METALS; IRON ORE

After a difficult year in 1990, the Canadian steel industry did not fully recover in 1991. At best, only eight blast furnaces were operating, compared with 10 as late as October, 1989. As a result, domestic consumption of iron ore remained nearly 2.0 million tonnes below the historical level. Furthermore, with the permanent closure of two domestic mines in 1990, imports of iron ore from the United States remained high at 5.0 million tonnes, accounting for 40% of Canadian iron ore consumption.

Canadian iron ore mines and ancillary plants produced 37 million tonnes of concentrates, pellets and sinter from hematite and siderite ores, in 1991. The production of concentrate that was not further processed to pellets or sinter increased to 16.2 million tonnes from 12.8 million tonnes, a response to demand for fines and concentrates in Europe.

Acid pellet production fell by 2.0 million tonnes, to 13.8 million tonnes, and fluxed pellet production decreased to 6.2 million tonnes. Sinter produced at the mine site recovered somewhat to 901,500 t after production of only 769,000 t in 1990.

Canadian Employment

Employment at Canadian iron ore mines, concentrators, agglomerating plants and support services fell to 5,900 by the end of 1991, the second year of declining employment since 1989 when the level was 6,900.

Quebec Cartier Mining (QCM) produced 16.2 million tonnes of ore in 1991, having recovered from the difficulties encountered the previous year when it had changed its mine plan. QCM shipped 15.3 million tonnes of which 7.7 million tonnes was concentrate and the remainder was acid and fluxed pellets.

The Iron Ore Co. of Canada (IOC) shipped 15.2 million tonnes of which 5.9 million tonnes was acid pellets, 1.9 million tonnes was fluxed pellets, 0.1 million tonnes was chips, and 7.3 million tonnes was concentrate. IOC and CANMET continued research on the production of low-silica pellets to meet client demands.

Although a new 25-year mine plan calls for annual production of more crude ore than in either 1989 and 1990, IOC also announced that employee cutbacks and increased productivity would be necessary in 1992 to reduce production costs.

Mitsubishi announced its intention to purchase 20% of IOC, taking most of the 28% interest that had belonged to M.A. Hanna Co. Final arrangements with respect to closing the transaction are now being completed.

Wabush Mines shipped 4.7 million tonnes of pellets in 1991. The mine, mill and pellet plant closed for 71 days over the summer to bring inventories down and to reduce production. In a move to exploit new markets, Wabush made its first shipment of concentrates, supplying over 100,000 tonnes, to European steel mills. However, since the market for pellets appears depressed, Wabush announced that production capacity would be reduced from 6.1 million t/y to 4.6 million t/y in 1992. The stack emission control system was brought on-line in September.

The Algoma Ore Division returned to its 1990 production level. Some 1.2 million tonnes of superfluxed sinter was produced at Wawa, Ont. The plant used siderite ore from the adjacent mine, but over 40% of the feed was recycled material from steel mills. Algoma is examining the possibility of closing the mine and sinter plant as part of a restructuring of operations.

Hollinger North Shore Exploration, owned by the La Fosse Platinum Group, continued its efforts to reopen one or more of the direct shipping iron ore mines in the Schefferville area. La Fosse is also attempting to develop the manganese deposits in the region.

World developments

World trade in iron ore reached 199 million tonnes for the first six months of 1991, and may exceed 400 million tonnes for the year, a small increase from the 395 million tonnes traded in 1990. World trade was again led by exports from Brazil which established a new record of close to 120 million tonnes. Australia was second (110), and the next largest exporters were the U.S.S.R. (28), India (27) and Canada (26). Japan took 30% of world imports and the European Economic Community took 34%.

UNCTAD dialogue on iron ore

The Intergovernmental Group of Experts on Iron Ore (IGE), under the United Nations Conference on Trade and Development (UNCTAD), met in Geneva Oct. 21-23, 1991.

Japan participated as a member for the first time. New information was made available by the delegates of the countries of Eastern Europe whose economies are currently undergoing dramatic transitions.

The level of response to the secretariat’s questionnaires on iron ore statistics improved during the year and now comes directly from 85 countries, including all major producers and consumers. Notable new additions were the Peoples Republic of China and the Republic of Ukraine. The secretariat will be producing preliminary 1991 statistics in early 1992.