The following content is excerpted from the prospectus of Sunshine Silver Mining & Refining Corporation (to be renamed Gatos Silver, Inc.) dated October 6, 2020 filed on SEDAR. filed on SEDAR.
Silver Demand
Iron ore products come in many varieties (pellet, lump, concentrate, sinter feed, etc.), quality ranges
(judged based on presence of deleterious elements like phosphorus, alumina, silica), grades (iron percentage),
percentages of loss-on-ignition ("LOI") (which measures yield loss upon sintering), and densities (with products
that have higher specific gravities being more efficient in blast furnaces). The "quality" of iron ore is determined
principally by how these variations affect either the efficiency of the blast furnace or the quality of the
finished steel.
AME Consulting Group Ltd. ("AME") has observed a substantial shift in the iron ore market favouring higher grade products. This has been
particularly noticeable in China, the main consumer of seaborne iron ore, where recent policy measures focused
on environmental protection have driven demand for high grade concentrates. Policy initiatives have included
the closure of induction furnaces, shuttering of excess steel-making capacity and winter steel production cuts in
the Beijing-Tianjin area. These measures, coupled with a general strengthening of Chinese industrial demand
have put pressure on the remaining steel plants to increase their efficiency which has, in turn, driven the market
for high grade iron ore. Other factors driving the market for high grade iron ore are summarized in the
table below:
Source: Prospectus of Tacora Resources Inc. dated February 5, 2018
Global demand for iron ore is expected to increase by over 100 Mt by 2020. China is the largest consumer of
iron ore in the world and is expected to maintain its high level of demand through 2020. India is expected to
experience the largest growth in iron ore demand in the world from 2018-2020, emerging as the second-largest
iron ore consumer in the world by 2020 on the back of increasing steelmaking.
Source: Prospectus of Tacora Resources Inc. dated February 5, 2018
Iron Ore Market
Iron Ore Demand >>
Iron ore products come in many varieties (pellet, lump, concentrate, sinter feed, etc.), quality ranges
(judged based on presence of deleterious elements like phosphorus, alumina, silica), grades (iron percentage)...
More >>
Iron Ore Supply >>
AME estimates global 2017 iron ore supply at approximately 2.1 billion dmt, a 3% growth from 2016. The
growth is attributed to new projects as well as growth from smaller producers in major producing regions...
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Iron Ore Pricing >>
Iron ore was historically priced through annual negotiations between the world's largest steelmakers and
their suppliers. However, in recent years, the Platts 62% Fe Fines CFR North China...
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Iron Ore Types >>
Iron ore comes in many chemical formulations (minerals), with the three most common forms being
hematite, magnetite and goethite. While iron ore deposits were traditionally predominantly hematite...
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Iron Ore Quality >>
Iron ore comes in many chemical formulations (minerals), with the three most common forms being
hematite, magnetite and goethite. While iron ore deposits were traditionally predominantly hematite...
More >>
