Major Australian producers expand iron ore capacity

Major Australian producers expand iron ore capacity

Considering the fact that iron ore demand will continue to stay firm in China, Australian major iron ore producers BHP Billiton and Rio Tinto Plc are expanding their production capacities. Furthermore, the prices of iron ore are also expected to see an increase of about 3% in the coming years. The companies believe that, due to the improving construction sector in China, the iron ore demand will keep on rising and may even exceed an annual figure of 300 million mts in 5 or 6 years. In line with such booming demand forecasts, the two giant Australian companies are expanding their capacities. BHP is going to increase its annual capacity from its current 88.5 million tons to 100 million tons by 2004 and Rio Tinto from 141.5 million tons to 183 million tons by 2006.