Australia absolutely raked it in at China’s literal expense in May, posting a new record in iron ore receipts on the back of never before seen prices.
The value of Australia’s iron ore exports to China have soared to a record $12.7 billion in May according to data from the Australian Bureau of Statistics.
It was expected, with a nine per cent increase in prices to a new monthly average record of US$207/t, and an increase in export volumes of 9% drove a $2.1b month on month rise, a roughly 20% increase.
Meat was another strong sector that, despite the ongoing diplomatic tensions between the countries which have hit Australian coal, seafood and wine exports, saw a 28% jump with another $57m flowing from our biggest trading partner.
Metalliferous ores, a category largely comprising iron ore, was responsible for $7.4bn of the $10bn (34%) increase in May exports year on year, an incredible 63% rise on exports from 12 months earlier at the height of the pandemic.
Exports of metalliferous ores to all countries raked in a cool $19.04bn, with iron ore sales outside China also increasing by around half a billion bucks, the third record high in a row.
It all drove Australia to a preliminary record monthly trade surplus of $13.3bn, on an 11% overall rise in exports to an also record high of $39.2bn.
The price did climb above $US230/t by the middle of the month before dropping below $US190/t just days after China announced plans to crack down on speculation it claimed was putting a rocket under prices.
Clearly China’s attempts to smash down iron ore prices have not gone as planned, with the country’s economic regulator, the National Development and Reform Commission, announcing a new iron ore spot market probe on Monday.
It had little immediate impact, with prices dropping briefly before climbing around 6% overnight to return to levels above US$210/t on Tuesday.