Simandou targets full iron ore export capacity in 2027

Simandou’s rail and port operator aims to support 120 million tonnes of annual iron ore exports by the end of 2027, operations chief Matt Baartz said during a site visit Monday, according to Guinean news outlet Guinee360.

The logistics network operated by Compagnie du TransGuinéen has annualized capacity of about 72 million tonnes, BMO Capital Markets said Wednesday, citing Bloomberg. Further expansion depends on deliveries of locomotives and wagons and commissioning the second stage of Morébaya port by March 2027, the bank said.

Mine output follows a separate schedule. Rio Tinto (ASX, LSE: RIO) said in October that its SimFer operation remained on track to reach an annual production rate of 60 million tonnes in the second half of 2028. SimFer accounts for half of Simandou’s planned mining capacity.

The pace of the increase will help determine how much competitive pressure Guinea places on established exporters. Simandou’s growing shipments are already offsetting supply declines elsewhere as weaker prices and higher freight and diesel costs squeeze producers, Macquarie Group analysts said in a note reported by Bloomberg on Nov. 3.

Shipments accelerate

Guinea exported 8.9 million tonnes of iron ore in the third quarter, 48% more than the 6 million tonnes shipped in the preceding three months, according to government data cited by Bloomberg. Baowu Winning Consortium Simandou accounted for 6.55 million tonnes and SimFer for 2.16 million tonnes.

Exports could reach about 28 million tonnes this year if October’s shipment pace holds and weather permits, Macquarie estimated. That forecast measures tonnes shipped over the year; the 120-million-tonne target describes the annual rate the infrastructure is intended to support.

Forecasts for reaching full output vary. Fearnley Securities projected 120 million tonnes of annual capacity during 2028, shipping publication TradeWinds reported in October. In a June assessment, S&P Global Energy CERA analysts expected full ramp-up to take more than five years and forecast Guinean exports of about 70 million tonnes in 2028.

Simandou’s four mining blocks are split between two operations. Baowu Winning Consortium Simandou develops blocks 1 and 2. SimFer holds blocks 3 and 4 through a partnership involving Rio Tinto, a Chinalco-led consortium and Guinea’s government. The two mining groups each hold 42.5% of the shared infrastructure company, with Guinea holding 15%.