Guinea’s Simandou mega-mine recently entered production in breezy remoteness, southeastern mountain tops. If successful, this initiative would transform the global iron ore trade. The mine has the capacity to produce 120 million tons of iron ore annually. This makes Guinea the fifth-largest iron ore exporter worldwide. This encouraging development puts Guinea in direct competition with known heavyweights like Australia, Brazil, China and India.
That first shipment of iron ore from the Simandou mine would prove to be an important turning point in this change. The inaugural train on the newly built Trans-Guinea Railway rolled out amid great enthusiasm. It carried tons of ore through thousands of kilometers of inhospitable terrain then was forced to dock at a foreign port. The trip brought home the incredibly difficult logistical effort it would take to export the valuable resource that existed in such a remote location.
At the port of Morebaya, the huge bulk carrier Winning Youth was waiting for its cargo. It was full of almost 10,000 metric tons of bright-red ochre, just dug out of the insides of the mountains. To receive this first shipment, a key milestone for Guinea. This is indicative of the country’s resolve to ensure that it becomes a prominent competitor in the global iron ore market.
Once loaded, the Winning Youth soon departed on a remarkable 11,000-nautical-mile journey. It rounded the Cape of Good Hope and traversed the still largely unexplored Indian Ocean. The ship’s maiden journey will take her through the highly trafficked Strait of Malacca. From there, it will make its way to its final steaming point in the South China Sea. The iron ore will go directly to a steel mill in China. This delivery reinforces the current strong demand fundamentals across Asia for premium quality iron ore.
The implications of this development are vast. Given its new production capacity, Guinea is well positioned to be a major supplier on the global stage. The economic impact of the output from the Simandou mine will be transformational for the impoverished country. Beyond that, it would further disrupt the global iron ore supply chain.