THE world’s biggest iron ore producers are depleting reserves faster than they can replace them, Bloomberg reported, citing research by Wood Mackenzie.
The trend is pushing up the cost of maintaining production.
The six largest iron ore producers, including BHP and Rio Tinto, depleted 11.1 billion tons of saleable ore reserves between 2016 and 2025, Wood Mackenzie said.
Only three replaced all the ore they mined over the period. The cost of adding new reserves also varied sharply, with some producers spending up to five times more than others.
The industry is also grappling with declining ore grades as ageing mines require companies to dig deeper and spend more to extract the same amount of usable material.
“The industry is investing to sustain production, but it is having to work harder to stand still,” Wood Mackenzie research director Mihir Vora said.
Costs for some major producers have roughly doubled since 2016, according to the consultancy.
Industry cash margins peaked in 2021 and have since settled at about $50 to $60 a ton, leaving producers with less room to absorb higher costs or weaker iron ore prices.
Wood Mackenzie also found that ore grades had fallen by as much as 1.6 percentage points at some producers since 2016, while impurity levels had risen in some products.
