Iron ore export facilities in the Pilbara region of Australia face being out of action for several days and possibly a week, a leading industry analyst has forecast.
“Cyclone Veronica has crippled activity around the three major ports in the world’s most important iron ore exporting region in terms of tonnes,” said Cleaves Securities head of research Joakim Hannisdahl.
According to the latest forecast, the unusually slow moving cyclone is expected to edge down the coastline and to move into the Indian Ocean on Wednesday.
“Depending on the damage caused, we do not expect full-scale seaborne exports to resume until Thursday at the earliest, and potentially not until the weekend,” he said.
“We see limited respite for lackluster capsize spot rates until Pilbara exports are back online, but believe rates will respond positively when activity is normalized.”
Cyclone Veronica made landfall between Port Hedland, Port Dampier and Cape Lambert over the weekend causing widespread damage.
Australia currently supplies about 60% of the world's iron ore, and about 90% of that comes from the three major Pilbara ports.
“As a precautionary measure, the ports of Cape Lambert and Dampier have been cleared of vessels and port operations have stopped,” Rio Tinto said in a statement.
BHP said initial inspections had shown water damage to some buildings at its Nelson Point rail and port facilities in Port Hedland.
“The ports of Ashburton, Dampier and Port Hedland ceased all operations on Friday 22 March 2019 and remain closed,” Pilbara Ports Authority confirmed in a statement.
“Once the ports re-open, Pilbara Ports Authority will also provide the total number of hours each port was shut down.”
