Speaker Spotlight: Allon Brent15 March 2019
As we build up to Iron Ore 2019, we will be interviewing our keynote speakers on some key issues within the Iron Ore industry.
This month we asked Allon Brent for his views on the industry.
Allon Brent is the Principal of Perth based consultancy Global Minerals Marketing, having retired as Iron Ore Marketing Manager from BHP in 2016. Allon has over 30 years experience in the international minerals and metallurgical industries, having held senior management roles in Marketing, Technology/R&D, Business Development and Operations.
Q. In 2017 there was a strong focus on the importance of mineralogy and petrology on iron ore processing characteristics (ie geometallurgy), the rationale being that you need to understand the detailed characteristics of an ore to optimise mining, blending, beneficiation and downstream processing operations. Do these characteristics still hold true in 2019?
A. Yes, I believe that they continue to hold true today and will likely become more important as China continues on its path to increase steel industry efficiency and reduce emissions, both of which favour higher quality iron ores over lower grade products. As ores do not beneficiate equally, a fundamental understanding of ore geomet characteristics is essential to optimise product quality through mining, beneficiation and blending, especially when deciding which ores may be more amenable to upgrading at reasonable capital and operating costs. ROM head grades will inevitably decline over time as producers exhaust the highest grade resources, and as the market continues to favour higher quality ores, I think we will see more beneficiation, particularly in the Pilbara, and this will require detailed understanding of ore geomet properties.
Q. How important is flexibility when responding to today’s market conditions (Feijao collapse vs slowing Chinese economy)?
A. I see flexibility becoming an increasingly important theme going forward in the more competitive Post China boom market environment, with those producers able to profitably flex both volume and quality over time being the most able to optimise value. We’ve seen Australia’s biggest iron ore producer, Rio Tinto actively promote it’s “Value over Volume” mantra, as it moved to protect the quality and pricing of it’s flagship Pilbara Blend fines by actively removing some higher alumina/P ore components and selling these as a discrete RTX product.
The potential for major industry disruptions such as the withdrawal of ~40 Mtpa of high quality supply from Brazil as Vale has shut capacity in the wake of the Feijao tailings dam failure also highlights the importance of flexibility. This supply withdrawal has resulted in iron ore price increases and a decline in some quality differentials such as that between the 62% Fe and 58% Fe categories. Supply security has recently become the focus of mill purchasing, with quality being of secondary importance to acquiring Fe units to keep blast furnaces operating. So those producers able to respond by flexing production rates are better suited to realise value from these types of industry disruptions.
To optimise value in the long term, the iron ore industry needs to remain flexible enough to be able to respond to major industry disruptions both on the supply side (e.g. Vale capacity shutdowns) and on the demand side (e.g. the recent US/China “Trade Wars”).
Q. What message would you like to provide to the delegates – what do you hope will be the main message they will take away from your keynote presentation?
A. Despite the recent market surge resulting from the Vale closures, the China Boom years are over and producers need to be able to prosper in a more competitive environment where quality is likely to be increasingly important moving forward as China continues to improve steel industry efficiencies and reduce emissions. I see strong technical capabilities as being the key to optimising value for iron ore producers in the future – from geosciences and mining engineering on the resource side, to metallurgical skills and geomet knowledge for ore processing, application of artificial intelligence and automation in the production chain to increase productivity and reduce costs, through to a deep technical understanding of the market to maximise product price realisation.