Although shipments were ceased for two days last month due to the category three Cyclone Christine, Port Hedland still recorded another rise in exports in December.
Australia's busiest port exported a total of 29.9 million tonnes of goods for the month, which included exports of copper, manganese ore and salt. Predominantly the exports were made up of iron ore shipments to China, which hit 24.1 million tonnes for the month – an increase of 8% compared to November's 22.3 million tonnes and a jump of 19% in comparison to the prior year's result.
The above figures are strong for this time of the year, given that it is the northern hemisphere's winter period and also northern Australia's wet season. Iron ore has remained resilient over the last 12 months, with its average price far exceeding the expectations of most analysts. Throughout the December quarter, its price remained around US$133 per tonne.
While shipments were still up for the month, the nation's largest iron ore miners, namely BHP Billiton (ASX: BHP) and Rio Tinto (ASX: RIO), will update the market on their operations in the coming weeks and should mention how they were impacted by the storms. BHP and Fortescue Metals Group (ASX: FMG) both ship from Port Hedland, while Rio Tinto exports its ore from Cape Lambert and Dampier, which are located west of Port Hedland.
Ongoing global demand for the steelmaking ingredient has resulted in each of the aforementioned miners ramping up production levels to increase profitability while the commodity's price remains high. Currently, Port Hedland's export capacity remains at 495 million tonnes, but it is believed that with additional work its capacity could increase substantially.
Foolish takeaway
Although the price of iron ore has remained resilient in the last 12 months, analysts have pegged it to fall in value in 2014. While Rio Tinto and Fortescue would be bigger beneficiaries if it were to remain strong (given that they are more exposed to the commodity), BHP would be a safer bet for investors who don't want to take that risk.
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