These past few years have been tough on miners. The industry’s been stuck in a down cycle longer than expected. Mines have inched along due to low commodities. In some cases, they’ve stalled completely.

Like George Bailey in It’s a Wonderful Life, things just haven’t worked out.
Like George Bailey, the mining industry couldn't catch a break.

But, (*SPOILER ALERT*) there’s no need to head for the bridge just yet! Like the guardian angel that comes to show ol’ George the way, one commodity is seeing a turnaround and giving mines a welcome holiday surprise — good, ol’ iron ore.

A lot of miners had written off iron ore years ago, thinking only the lowest grade material still sat in the ground. But in a sharp surprise, iron has taken off in late 2016, reaching $83.58 USD per tonne in mid-December — its highest level since October 2014.

Analysts think two factors have driven this surge: An uptick in Chinese demand and the election of incoming U.S. President Donald Trump, who has promised to invest heavily in American infrastructure.

Although current projections show the price of iron ore softening to between $48 USD and $56 USD come January, many are hopeful these factors will keep the price near its current level.
Iron ore is rising

Just in time to take advantage of these rising prices, Vale SA has opened the world’s largest iron ore project in Canaã dos Carajás, Brazil: S11D. This complex in the southeast of Pará state cost $14.3 billion to build, but comes with a life expectancy of 30 years. As part of that hefty price tag, the mine includes an on-site processing plant and a 101 km rail system connecting the plant with the Carajás railroad.

Brazil isn’t the only nation to capitalize on these rising prices, though. The iron-rich region of Pilbara in Western Australia has rocketed up its output too. It’s reporting that exports were up 10% this November.

All in all, these numbers offer the mining industry a glimmer of hope after several long, hard years. They come as a much-appreciated gift for everyone in mining as we enter this holiday season.

Happy holidays, everyone!