Iron ore production and shipment by geography

Production by mine annually (2011 – 2015) and quarterly (2015)

(millions of metric tonnes)1

Mine Type Product 2011 2012 2013 2014 2015 1Q 15 2Q 15 3Q 15 4Q 15
Kazakhstan     4.0 4.0 3.7 3.6 2.9 0.9 0.9 0.5 0.5
Lisakovski Open Pit Concentrate 1.8 2.3 2.1 1.6 0.9 0.4 0.3 0.1 0.2
Kentube Open Pit Concentrate 0.7 0.7 0.7 0.7 0.7 0.2 0.2 0.1 0.2
Atasu Underground Lump & fines 1.2 0.6 0.6 0.9 0.9 0.2 0.3 0.2 0.1
Atansore Open Pit Lump & Fines 0.3 0.4 0.4 0.4 0.4 0.1 0.1 0.0 0.1
Ukraine     10.6 10.7 11.3 10.9 11.0 2.6 2.8 2.7 2.9
Kryviy Rih Open Pit Concentrate 9.6 9.8 10.2 9.9 10.1 2.4 2.6 2.5 2.7
Kryviy Rih Underground Lump & sinter feed 1.1 0.9 1.0 1.0 0.9 0.2 0.3 0.2 0.3
Algeria2     1.3 1.4 0.7 0.5 - - - - -
Bosnia     1.9 2.1 2.1 2.1 2.1 0.5 0.6 0.6 0.4
Mexico     6.9 7.3 6.8 6.5 5.3 1.5 1.6 1.5 0.7
Peña Colorada3 Open Pit Concentrate & Pellets 2.2 2.3 2.0 1.7 1.7 0.4 0.4 0.5 0.4
Las Truchas Open Pit Concentrate, lump & fines 2.6 2.9 2.6 2.5 1.8 0.6 0.6 0.5 0.1
Volcan Open Pit Concentrate 2.0 2.2 2.2 2.3 1.7 0.6 0.6 0.5 0.1
Canada     15.1 15.0 18.0 23.3 25.9 5.6 6.8 6.2 7.2
QCM (Mount Wright) Open Pit Concentrate & Pellets 15.1 15.0 18.0 23.3 25.9 5.6 6.8 6.2 7.2
USA     7.7 7.9 7.7 7.5 7.8 2.0 1.7 2.1 2.1
Hibbing3 Open Pit Pellets 4.9 5.0 4.8 4.8 5.1 1.3 1.2 1.3 1.3
Minorca Open Pit Pellets 2.8 2.9 2.9 2.7 2.7 0.7 0.4 0.8 0.8
Brazil     5.3 4.1 3.9 4.5 3.5 0.9 1.0 0.9 0.8
Serra Azul Open Pit Lump & fines 3.6 1.7 1.4 1.8 2.0 0.5 0.5 0.5 0.5
Andrade4 Open Pit Fines 1.7 2.3 2.5 2.6 1.5 0.4 0.4 0.4 0.3
Liberia     1.3 3.3 4.1 4.9 4.3 1.5 1.2 0.9 0.9
                       
Own production     54.1 55.9 58.4 63.9 62.8 15.6 16.4 15.4 15.5
                       
South Africa5     6.5 4.7 4.7 4.9 4.3 1.4 1.3 1.0 0.5
Sishen Open Pit Lump & fines 5.1 3.5 4.0 3.9 3.0 1.1 0.9 0.7 0.3
Thabazambi Open Pit Lump & fines 1.4 1.2 0.7 1.0 1.3 0.3 0.4 0.3 0.3
USA     4.6 7.6 7.0 8.2 6.6 1.1 1.4 2.1 2.0
Cleveland Cliffs6 Open Pit Pellets 4.6 7.6 7.0 8.2 6.6 1.1 1.4 2.1 2.0
Strategic contracts     11.1 12.3 11.7 13.1 10.9 2.5 2.7 3.1 2.5
                       
Total     65.2 68.1 70.1 77.0 73.7 18.1 19.1 18.4 18.1

Own iron ore production (2011-2015)

Production million tonnes
2011 2012 2013 2014 2015
54.1 55.9 58.4 63.9 62.8

Total iron ore production by country 2015

Total 62.8
(Millions of metric tonnes) 2015
Kazakhstan 2.9
Ukraine 11
Bosnia 2.1
Mexico 5.3
Canada 25.9
USA 7.8
Brazil 3.5
Liberia 4.3

1 Total of all finished production of Fines, Concentrate, Pellets and Lumps.

2 On November 25, 2014, ArcelorMittal and the Algerian state-owned companies Sider and Ferphos Group signed an agreement whereby the Company’s interest in the Tebessa mines in Ouenza and Boukhadra will be diluted from 70% to 49%. The transaction was completed on January 10, 2015. On October 7, 2015, ArcelorMittal announced it reached an outline agreement for restructuring the shareholding of its Algerian activities (49% interest in the associates ArcelorMittal Algérie and ArcelorMittal Tebessa and 70% interest in the subsidiary ArcelorMittal Pipes and Tubes Algeria).

3 Includes own share of production.

4 Operated by Vale; prices on a cost plus basis until November 15, 2009. From November 16, 2009, the mine has been operated by ArcelorMittal and included as own production.

5 Includes purchases under a strategic agreement with Sishen/Thabazambi (South Africa). Prices for purchases under the July 2010 interim agreement with Kumba (as extended and amended several times) have been on a fixed-cost basis since March 1, 2010. On November 5, 2013, ArcelorMittal announced that its 51% subsidiary, ArcelorMittal South Africa, had reached an agreement with Sishen Iron Ore Company Ltd (SIOC), a subsidiary of Kumba, relating to the long-term supply of iron ore. The agreement, which become effective as of January 1, 2014, allows ArcelorMittal South Africa to purchase up to 6.25 million tonnes a year of iron ore from SIOC, complying with agreed specifications and lump-fine ratios at cost plus basis. This volume of 6.25 million tonnes a year of iron ore includes any volumes delivered by SIOC to ArcelorMittal from the Thabazimbi mine, the operational and financial risks of which will pass from ArcelorMittal to Kumba under the terms of this agreement. The agreement settles various disputes between the parties. On November 6, 2015, ArcelorMittal announced that an agreement had been reached with SIOC to amend the pricing mechanism terms of the current iron ore supply agreement from a cost-based price to an Export Parity Price (“EPP”) with effect from October 1, 2015. The EPP will be calculated on the basis of the Platts 62% Fe CFR China Fines Index (the “Index price”) and, at certain price levels, ArcelorMittal will receive a discounted price. In addition, under the amended agreement, ArcelorMittal South Africa will no longer contribute toward stripping costs. Accordingly at December 31, 2015, the “deferred stripping pre-payment asset” was derecognized. As a result of this amendment, the contract will no longer be considered as a strategic contract in 2016.

6 Consists of a long-term supply contract with Cleveland Cliffs for purchases made at a previously set price, adjusted for changes in certain steel prices and inflation factors.

Production by region annually (2011 - 2015) and quarterly (2015)

(millions of metric tonnes)1

(Production million tonnes)1                      
Mine Type Product 2011 2012 2013 2014 2015 1Q 15 2Q 15 3Q 15 4Q 15
North America2 Open Pit Concentrate, lump, fines and Pellets 29.7 30.3 32.5 37.4 39.0 9.2 10.0 9.8 10.0
South America3 Open pit Lump and fines 5.3 4.1 3.9 4.5 3.5 0.9 1.0 0.9 0.8
Europe Open pit Concentrate and lump 1.9 2.1 2.1 2.1 2.1 0.5 0.6 0.6 0.4
Africa4 Open Pit / Underground Fines 2.6 4.7 4.8 5.5 4.3 1.5 1.2 0.9 0.9
Asia, CIS & Other Open Pit / Underground Concentrate, lump, fines and sinter feed 14.6 14.7 15.0 14.5 13.9 3.6 3.7 3.2 3.4
Own production     54.1 55.9 58.4 63.9 62.8 15.6 16.4 15.4 15.5
North America5 Open Pit Pellets 4.6 7.6 7.0 8.2 6.6 1.1 1.4 2.1 2.0
Africa6 Open Pit Lump and Fines 6.5 4.7 4.7 4.9 4.3 1.4 1.3 1.0 0.5
Strategic contracts     11.1 12.3 11.7 13.1 10.9 2.5 2.7 3.1 2.5
Total     65.2 68.1 70.1 77.0 73.7 18.1 19.1 18.4 18.1

Own iron ore production by region 2015

Total 62.8
(Production million tonnes) 2015
North America2 39.0
South America3 3.5
Europe 2.1
Africa4 4.3
Asia, CIS & Other 13.9

1 Total of all finished production of Fines, Concentrate, Pellets and Lumps (includes share of production and strategic long-term contracts).

2 Includes own mines and share of production from Hibbing (USA-62.30%) and Peña (Mexico-50%).

3 Includes Andrade mine operated by Vale until November 15, 2009: prices on a cost plus basis. From November 16, 2009 the mine has been operated by ArcelorMittal and included as captive.

4 On November 25, 2014, ArcelorMittal and the Algerian state-owned companies Sider and Ferphos Group signed an agreement whereby the Company’s interest in the Tebessa mines.

5 Consists of a long-term supply contract with Cleveland Cliffs for purchases made at a previously set price, adjusted for changes in certain steel prices and inflation factors.

6 Includes purchases under a strategic agreement with Sishen/Thabazambi (South Africa). Prices for purchases under the July 2010 interim agreement with Kumba (as extended and amended several times) have been on a fixed-cost basis since March 1, 2010. On November 5, 2013, ArcelorMittal announced that its 51% subsidiary, ArcelorMittal South Africa, had reached an agreement with Sishen Iron Ore Company Ltd (SIOC), a subsidiary of Kumba, relating to the long-term supply of iron ore. The agreement, which become effective as of January 1, 2014, allows ArcelorMittal South Africa to purchase up to 6.25 million tonnes a year of iron ore from SIOC, complying with agreed specifications and lump-fine ratios. This volume of 6.25 million tonnes a year of iron ore includes any volumes delivered by SIOC to ArcelorMittal from the Thabazimbi mine, the operational and financial risks of which will pass from ArcelorMittal to Kumba under the terms of this agreement. The agreement settles various disputes between the parties. On November 6, 2015, ArcelorMittal announced that an agreement had been reached with SIOC to amend the pricing mechanism terms of the current iron ore supply agreement from a cost-based price to an Export Parity Price (“EPP”) with effect from October 1, 2015. The EPP will be calculated on the basis of the Platts 62% Fe CFR China Fines Index (the “Index price”) and, at certain price levels, ArcelorMittal will receive a discounted price. In addition, under the amended agreement, ArcelorMittal South Africa will no longer contribute toward stripping costs. Accordingly at December 31, 2015, the “deferred stripping pre-payment asset” was derecognized. As a result of this amendment, the contract will no longer be considered as a strategic contract in 2016.

Iron ore shipments annually (2011 - 2015) and quarterly (2015)

Millions of metric tonnes 2011 2012 2013 2014 2015 1Q 15 2Q 15 3Q 15 4Q 15
External Sales - Third party 9.0 10.4 11.6 14.4 13.7 2.3 4.2 3.5 3.6
Internal sales - Market Priced 19.0 18.4 23.5 25.4 26.7 7.0 6.6 6.8 6.2
Total market priced shipments 28.0 28.8 35.1 39.8 40.3 9.4 10.8 10.3 9.9
Captive (Cost plus basis) 23.6 25.6 24.4 23.9 22.1 4.1 6.4 5.9 5.8
Total Shipments 51.6 54.4 59.6 63.7 62.4 13.4 17.2 16.2 15.6
Strategic contracts 11.1 12.3 11.7 13.1 11.4 2.5 2.7 3.1 3.1
Total shipments including strategic contracts 62.7 66.6 71.3 76.80 73.9 16.0 19.9 19.2 18.7

Iron ore shipments 2015

Market priced, captive and strategic contracts
Total 73.8
Millions of metric tonnes 2015
Market Priced 40.3
Captive (Cost plus basis) 22.1
Strategic contracts 11.4
External sales and third party and internal sales - market priced
Total 40.3
Millions of metric tonnes 2015
External Sales - Third party 13.7
Internal sales - Market Priced 26.7

There are three categories of sales: 1) “External sales”: mined product sold to third parties at market price; 2) “Market-priced tonnes”: internal sales of mined product to ArcelorMittal facilities and reported at prevailing market prices; 3) “Cost-plus tonnes” - internal sales of mined product to ArcelorMittal facilities on a cost-plus basis. The determinant of whether internal sales are reported at market price or cost-plus is whether the raw material could practically be sold to third parties (i.e. there is a potential market for the product and logistics exist to access that market).