According to a Reuters report cited by Mining Weekly, three informed sources revealed that Rio Tinto is stockpiling 2 million mt of high-grade iron ore at the Simandou iron ore deposit in Guinea for export in November. This will mark the mine's first export and is set to alter the global iron ore supply landscape and bargaining power.
Rio Tinto stated in its recently released Q3 production report that SIMFER, one of the two iron ore mines at Simandou, has cumulatively mined 1.5 million mt of iron ore. The first batch of ore is scheduled to be shipped via rail in October.
A spokesperson said the company continues to advance the project "rapidly" but did not provide details.
Anonymous sources indicated that the initial shipment of iron ore will be sent to China, the world's largest steel producer and the consumer of over 70% of the world's seaborne iron ore.
Rio Tinto will initially transport the iron ore using infrastructure owned by the Winning Consortium (WCS), whose port is nearing completion.
On the 14th, Rio Tinto said, "We expect to be able to load the ship in November," but did not disclose the initial shipment volume.
The Simandou iron ore mine will be connected to a deep-water Atlantic port via a 600-km railway line. The mine's owners include a consortium of Rio Tinto and Aluminum Corp. of China, as well as the Singapore-China joint venture Winning Consortium.
The Simandou deposit is estimated to contain 4 billion mt of reserves with an average grade of 65%. At full production, it is expected to produce 120 million mt of iron ore annually, with SimFer accounting for half of that output.
According to IMF estimates, the project is expected to increase Guinea's GDP by 26% by 2030.
Guinea's military government plans to officially commission the project on November 11.
The other operator at Simandou, WCS, also began stockpiling iron ore in September to capture early market share.
"If Australian and Brazilian miners fail to effectively respond to Simandou's production ramp-up, iron ore prices will face downward pressure," said Tom Price, head of commodities at Panmure Liberum.
"The 120 million mt production in 2028 will increase seaborne iron ore capacity by 8%-9%."
In July, Rio Tinto's Chief Financial Officer Peter Cunningham stated that the launch of the Simandou project could force some higher-cost suppliers out of the market.
WCS and Guinea's Ministry of Mines have not responded to requests for comment.
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