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West and Central African Iron Ore : A Lesson in the Contestability of the Iron Ore Market


  • Luke Hurst

    (East Asia Bureau of Economic Research (EABER))


The paper briefly sets out factors behind Chinese demand for iron ore imports and the main features of China’s medium term resource consumption growth path. It then outlines the potential of major iron ore export countries to meet China’s medium term iron ore import demands. The focus of the paper is on the potential of iron ore supplies from west and central Africa to enter the export market over the short and medium terms. To assess this, three export capacity scenarios (low, medium and high risk) are constructed for 17 iron ore mines (over 27 production expansion phases) in west and central African. The results suggest the development of west and central African iron ore has the potential to create significant downward pressure on the price of iron ore exports over the short to medium term. The impact of the excess export capacity on iron ore price is estimated and it suggests that there would be significant knock-on effects for iron ore-centric economies such as Australia and Brazil.

Suggested Citation

  • Luke Hurst, 2012. "West and Central African Iron Ore : A Lesson in the Contestability of the Iron Ore Market," Trade Working Papers 23292, East Asian Bureau of Economic Research.
  • Handle: RePEc:eab:tradew:23292

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    References listed on IDEAS

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    Cited by:

    1. Germeshausen, Robert & Panke, Timo & Wetzel, Heike, 2014. "Investigating the influence of firm characteristics on the ability to exercise market power: A stochastic frontier analysis approach with an application to the iron ore market," ZEW Discussion Papers 14-105, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.

    More about this item


    iron ore; China; Africa; demand for iron ore; iron ore price; Brazil; Australia;

    JEL classification:

    • L72 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Mining, Extraction, and Refining: Other Nonrenewable Resources
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q31 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Demand and Supply; Prices
    • Q37 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Issues in International Trade


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