STEEL + TECHNOLOGY 04/2019 EXTRACT

86 | PANORAMA
Vale S11D Eliezer Batista Complex in Brazil, aerial
view of the mine (Picture: Ricardo Teles © Vale)
Growing appeal of iron ore miners
5-year high iron ore prices look to revitalize
mining sector
Mining companies across the industry are looking forward to a strong year as prices for various commodities
continue to rise. Industrial metals in particular, such as iron ore, have broken records as prices surged to multiyear-highs.
Iron ore miners are well positioned to take advantage of this change in the market.
Many different commodities have
seen their prices jump so far in
2019. Precious metals, such as
gold, silver, and for a time, palladium, have
all seen prices surge in the first quarter.
However, few could have guessed that
industrial metals have seen some of the
largest price spikes so far in the year, with
iron ore reigning supreme in this regard.
After the tailings dam disaster in Brazil
and cyclone-related disruptions in Australia,
iron ore will be undersupplied in the
near term causing prices to shoot up. This
recent turn of events has made iron ore
producers far more desirable in the eyes
of analysts and investors. While major iron
ore miners are expected to benefit from
increased prices and the overall market
enthusiasm, many less-well-known, smallcap
miners are poised to take advantage
of this development as well.
Delrey Metals Corp holds a unique position
in this regard, with their signature Four
Corners Project based out of western
Newfoundland. While other valuable metals
like vanadium and titanium were found
at the site, metallurgical samples of highly
concentrated iron deposits in the area have
peaked the ears of analysts and investors
alike.
The situation of the global iron
market
Iron has surged by over 40 percent since
late 2018, with prices having just recently
broken the US$100 per tonne price point
hitting a high of US$108. Passing a record
not seen in over five years, this rise is due
to a variety of different factors.
One main reason contributing to this
rise has been due to supply shortages out
of Brazil. The world’s largest iron ore producer,
Vale SA, saw one of it’s biggest
dams collapse in late January. With hundreds
dead and billions of dollars of damages
done to the environment, the Brazilian
government stepped in to shut down
many less-than-safe facilities. Since then,
the company has said that these setbacks
have taken out 93 million tonnes of iron ore
out of the global market.
Other factors, such as poor weather in
another major iron producing region, Western
Australia, has also played a role in
iron’s surge in price. With demand for the
industrial metal remaining strong amidst
STEEL + TECHNOLOGY 1 (2019) No. 4