Global iron ore shipments have seen a significant decline of 7% year-on-year (y-o-y) during the first seven weeks of 2025, primarily driven by weak demand from China.
This downturn has been particularly pronounced in Australia, where exports have dropped by 10% compared to the previous year, while Brazilian shipments have decreased by 5%.
The overall demand for tonne-mile sea freight shipments of iron ore has also fallen by 6% y-o-y, said Filipe Gouveia, shipping analysis manager at BIMCO (the Baltic and International Maritime Council).
The recent decline in shipments has been exacerbated by supply disruptions in key exporting regions.
A cyclone recently forced the temporary closure of Australia’s largest iron ore port, leading to a staggering 55% drop in shipments compared to the same week in 2024. Port Hedland was temporarily closed due to Tropical Cyclone Zelia, which made landfall on 14 February. The cyclone was classified as a Category 5 storm with wind gusts reaching up to 320 km/h before it weakened.
Brazilian exports have also been challenged by a fire at the facilities of metals and mining company Vale in Port Tubarão.
Despite the relatively better performance of Brazilian shipments, which have increased average sailing distances, the overall impact on tonne-mile demand remains negative.
Gouveia highlighted that the weakness in iron ore shipments has contributed to a slump in freight rates, with the Baltic Dry Index averaging 44% lower than last year. The capesize segment, which handles the majority of iron ore transport, has experienced an even steeper decline, with rates down 55% year-on-year.
The situation is compounded by ongoing concerns regarding domestic steel demand in China.
Although Chinese steel exports have surged by 44%, this increase has not fully compensated for the weakened domestic consumption. High inventories of iron ore at Chinese ports have persisted since July 2024, indicating an oversupply situation that could further depress prices and demand for iron ore imports.
Gouveia said: "Uncertainty remains regarding the strength of the Chinese economy, which could greatly impact global iron ore import demand."
The outlook for iron ore shipments remains cloudy as trade tensions and tariffs on steel products from China could hinder export growth and affect production levels among major importers such as Japan and South Korea.
