Iron Ore

Iron (Fe) is a metallic element which constitutes about 5% of the Earth's crust and is the fourth most abundant element in the crust. Iron ores are rocks from which metallic iron can be economically extracted. The principal iron ores are hematite (Fe2O3) and magnetite (Fe3O4). Almost all iron ore is used in blast furnaces to make pig iron, which is the main material for steelmaking. Small amounts of iron ore are used in other applications such as coal wash plants and cement manufacturing. Iron is the most used metal accounting for about 95% of total metal tonnages produced worldwide.

Hematite is an iron oxide mineral. It is non-magnetic and has colour variations ranging from steel silver to reddish brown. Pure mineral hematite contains 69.9% iron. It has been the dominant iron ore mined in Australia since the early 1960s and approximately 96% of Australia's iron ore exports are high-grade hematite, most of which has been mined from deposits in the Hamersley province in Western Australia. The Brockman Iron Formation in the Hamersley province contains significant examples of high-grade hematite iron ore deposits.

Magnetite is another iron oxide mineral. It is generally black and highly magnetic, the latter property aiding in the beneficiation of magnetite ores. Mineral magnetite contains 72.4% iron, which is higher than hematite but the presence of impurities results in lower ore grade, making it more costly to produce the concentrates used in steel smelters. Magnetite mining is an emerging industry in Australia with large deposits being developed in the Pilbara and mid-West regions of Western Australia, and in South Australia.

High-grade hematite ore is referred to as direct shipping ore (DSO) because after it is mined, the ores go through a relatively simple crushing and screening process before being exported for use in steelmaking. Australia's hematite DSO from the Hamersley region in Western Australia averages from 56% to 62% iron. Like hematite ores, magnetite ores require initial crushing and screening, but undergo a second stage of processing that relies on the magnetic properties of the ore and involves magnetic separators to extract the magnetite and produce a concentrate.

Further processing involves the agglomeration and thermal treatment of the concentrate to produce pellets that can be used directly in blast furnaces, or in direct reduction steel-making plants. The pellets contain 65% to 70% iron, which is a higher iron grade than the hematite DSO currently being exported from the Hamersley region. Additionally, when compared to hematite DSO, the magnetite pellets contain lower levels of impurities, particularly phosphorous, sulfer and aluminium. These pellets are premium products that attract higher prices from steel makers, offsetting the higher costs of their production.

Large economically viable deposits of iron ore are essentially restricted to Western Australia and South Australia (Figure 3.15). Western Australia dominates both EDR and total resources, holding some 91% and 86%, respectively (Figure 3.16). South Australia holds 8% of iron ore EDR and 10% of total iron ore resources. Small deposits occur in Tasmania, the Northern Territory and New South Wales.

Figure 3.15 is a map of Australia showing the names, locations and size of major iron ore deposits (i.e., those with more than 1000 million tonnes of in situ resources). The map also shows the state boundaries and capital cities as well as the major geological provinces of the country. Iron ore deposits are displayed as filled red circles split into six sizes according to the total in situ resources of iron ore. The six sizes are labelled '1000 to 2000 million tonnes', '2000 to 3000 million tonnes', '3000 to 4000 million tonnes', '4000 to 5000 million tonnes', '5000 to 10 000 million tonnes' and 'greater than 10 000 million tonnes'. In addition, some circles are drawn with a heavy black line indicating that these deposits are operating mines. The map shows that nearly all the nation's iron ore deposits occur in the Archean rocks of the Western Australian Pilbara region. A few deposits, mostly less than 2000 million tonnes, are scattered over the mid-west of Western Australia, also in Archean provinces, and in South Australia in Archean and Proterozoic provinces.

Figure 3.15 Australia's major iron ore deposits based on total Identified Resources.
Source: Geoscience Australia.

Resources and Reserves

Table 3.21 Australia's resources of iron ore and contained iron with world figures as at December 2012.
Commodity Units JORC Reserves (% of EDR) Economic Demonstrated Resources (EDR) Paramarginal Demonstrated Resources Submarginal Demonstrated Resources Inferred Resources Accessible EDR Mine Production in 2012 World Economic Resources World Mine Production in 2012
Source: Geoscience Australia, the Bureau of Resources and Energy Economics and the United States Geological Survey; Paramarginal and submarginal demonstrated resources are subeconomic at this time; Mt = million tonnes; n.a. = not applicable.
Iron ore Mt 15 305 (34%) 44 650 566 1365 73 570 44 650 520 175 650 2959
Contained iron Mt 7931 (38%) 20 638 224 473 33 827 20 638 n.a. 83 688 n.a.

Figure 3.16 comprises two pie charts side by side. The one on the left shows the percentage of Economic Demonstrated Resources (EDR) of iron ore held by each state and territory in Australia as at December 2012. The chart on the right shows the percentage of total iron ore resources held by each state and territory in Australia as at December 2012. Western Australia dominates iron ore EDR with 91% followed by South Australia with 8%. Similarly, these two states hold the greatest proportion of total resources with Western Australia holding 86% and South Australia 10%. New South Wales holds 2% of total iron ore resources and the Northern Territory 1%. The Australian Capital Territory, Tasmania and Victoria each hold tiny amounts of iron ore, <1% of total resources.

Figure 3.16 Percentages of Economic Demonstrated Resources and total resources of iron ore held by the states and territories in Australia. Total resources comprise all Demonstrated and Inferred Resources. Numbers are rounded so might not add up to 100% exactly.
Source: Geoscience Australia.

World Ranking

Table 3.22 World economic resources for iron ore.
Rank Country Iron ore (Mt) Percentage of iron ore
world total
Contained iron (Mt) Percentage of contained
iron world total
Source: United States Geological Survey and Geoscience Australia; Figures are rounded to the nearest hundred million tonnes; Percentages are rounded so might not add up to 100% exactly; Mt = million tonnes.
1 Australia 44 700 25% 20 600 25%
2 Brazil 29 000 16% 16 000 19%
3 Russia 25 000 14% 14 000 17%
4 China 23 000 13% 7200 9%
5 India 7000 4% 4500 5%
6 United States of America 6900 4% 2100 3%
7 Ukraine 6500 4% 2300 3%
8 Canada 6300 4% 2300 3%
9 Venezuela 4000 2% 2400 3%
10 Sweden 3500 2% 2200 3%
  Others 23 800 13% 10 000 12%
  Total 179 650   83 650  
Table 3.23 World production for iron ore.
Rank Country Iron ore (Mt) Percentage of world total
Source: United States Geological Survey, the Bureau of Resources and Energy Economics and United Nations Conference on Trade and Development; Mt = million tonnes; Percentages are rounded so might not add up to 100% exactly.
1 Australia 520 26%
2 Brazil 375 19%
3 China 281 14%
4 India 245 12%
5 Russia 100 5%
6 Ukraine 81 4%
7 South Africa 61 3%
8 United States of America 53 3%
9 Canada 40 2%
10 Iran 28 1%
  Others 197 10%
  Total 1981  


Australia's EDR of iron ore declined from 1994 to 2003 (Figure 3.17) as a result of the combined impacts of increased rates of mine production and mining companies re-estimating reserves and resources to comply with the requirements of the JORC Code. Post 2003, EDR increased rapidly to 44 700 Mt in December 2012 (Figure 3.17), due to large increases in magnetite resources (including reclassification of some magnetite deposits to economic categories), and increases in hematite resources, mainly at known deposits. Mine production increased rapidly from 168 Mt in 2000 to 520 Mt in 2012.

Figure 3.17 shows the Economic Demonstrated Resources (EDR) of iron ore from 1975 to 2012. There is one line on the graph. The vertical axis is labelled in thousands of millions of tonnes beginning at 0 and in increments of 5000 million. The horizontal axis is labelled with the year starting with 1975 and ending with 2012. In the graph, the line begins at 17.8 000 million tonnes in 1975 and ranges between 13.9 000 and 18 000 million tonnes until 1994. It declined from 18 000 million tonnes in 1994 to 12.4 000 million tonnes in 2003. Post 2003, EDR increased rapidly to 44.7 000 million tonnes by December 2012.

Figure 3.17 Trends in Economic Demonstrated Resources for iron ore since 1975.
Source: Geoscience Australia.

Resource to Production Ratio

Table 3.24 Indicative years of iron ore resources (rounded to the nearest 5 years) as a ratio of Accessible Economic Demonstrated Resources divided by the production rate for each year.
Year 1998 2003 2008 2009 2010 2011 2012
Source: Geoscience Australia.
AEDR/Production 100 60 70 70 80 75 85