All eyes have been on the price of iron ore in recent days as volatility in the iron ore price has had a big impact on markets.

But while that is where the focus is in the here and now, there remains a story bubbling under the surface about where iron ore is headed in the future.

Increasingly, iron ore experts believe grade will be an important factor for steel mills, as efforts to curb emissions and pollution from steelmaking take centre stage.

Take this comment for instance from Fastmarkets index manager Peter Hannah, who observes iron ore markets for one of the two major price-reporting agencies.

“To succeed in decarbonizing the global steelmaking industry there needs to be a greater recognition of how much the iron ore supply base needs to change,” he wrote recently.

“Vast volumes of existing production will need to be replaced by higher-grade supply, first to meaningfully reduce CO2 emissions from the prevailing BF/BOF (blast furnace) technology, and later to meet the demands of a DRI (direct reduced iron) sector at least an order of magnitude larger than it is today.”

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