Iron Ore Shipments Resume at Tianjin as Operations Restored

Updated on

BHP Billiton Ltd. restored normal iron ore shipments at the Chinese port of Tianjin after deadly blasts caused disruptions, while Fortescue Metals Group Ltd. said deliveries were unaffected. Futures pared a weekly advance.

“We understand the iron ore berths are operating as normal and that port operations, including customs clearance, also resumed today,” Melbourne-based BHP said in an e-mailed statement. “We don’t anticipate any direct impact on our shipments through the port.”

BHP’s cargoes were disrupted Thursday after the explosions prompted authorities to restrict vessels calling at the facility while Rio Tinto Group said four fully laden bulk carriers were re-routed. Fortescue shipments were being delivered and handled as normal, an external spokesman for the company said in an e-mailed statement Friday.

Tianjin is a northern gateway for everything from coal, automobiles and oil into China and handled more than 11 percent of the country’s iron ore imports in the first half of the year, according to Clarksons Platou Securities. Iron ore on the Dalian Commodity Exchange jumped 2.7 percent Thursday to the highest in more than a month as disruptions supported prices already bolstered by the surprise devaluation of the yuan.

Futures for January delivery slid 0.7 percent to 385 yuan a metric ton in Dalian Friday, paring the week’s gain to 3.6 percent. Ore with 62 percent content delivered to Qingdao, another Chinese port, fell 0.5 percent to $56.74 a dry ton.

Shipping Delays

About 110 vessels are anchored in the sea off Tianjin in northern China after explosions in a hazardous-chemicals warehouse killed at least 55 people and injured more than 700. Shipping and logistics companies reported delays as some oil cargoes were still barred from one of the port’s wharves.

“It does seem pretty clear to us that the worst case scenario from a coal and iron ore trade standpoint has been avoided,” Clarksons said in a report dated Aug. 13. “With no damage to the bulk terminals, we’d expect the disruption to both iron ore and coal movements to be fairly minimal.”

Mills in China are the world’s largest buyers of iron ore with about 15 supplied via Tianjin, according to Mysteel Research, an industry analyst. Iron ore dropped to the lowest since at least 2009 last month as mining companies including BHP boosted output while demand growth stalled in China.

Imports by China climbed to the highest level this year in July after Australia and Brazil boosted shipments and as mills increased inventories.

Inbound cargoes were 86.1 million tons from 74.96 million tons a month earlier and 82.52 million tons a year ago, according to customs figures released Saturday. Imports totaled 539 million tons in the first seven months, little changed from a year earlier, the data showed.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE