The Trust, an affiliate of the United Nations Conference on Trade and Development (UNCTAD) stated that exports of iron ore from the western world may decline by no more than three percent or 13 million tonnes, this yearin part because of an expected reduction in demand in iron ore producing countries.

Almost all of the reduction will be due to lower imports by Japan and the European Union, said the report. It said the western world's crude steel production would also fall by about 4.5 per cent this year. For the year 2000, the only significant change expected is that crude steel production will recover in the EU and US possibly by four per cent. No recovery is expected in Japan. The report noted that 1998 production of 657.1 million tonnes of iron ore in the western world, excluding China and the formerSoviet Union, was one per cent lower than the record level posted during the previous year. Production of pig iron was down two per cent and crude steel output was down by three per cent. Production of pellets in 1998 was similar to 1997, with total exports more than three quarters from Brazil, Canada and Sweden which fell by 3.4 per cent.

Pellet production capacity in the western countries increased by 8.9 per cent or 17.5 tonnes in quantity during mid 1997-98.

The global production of DRI grew by 4.1 per cent to 36.7 million tonnes in 1998, but production capacity jumped by more than 20 per cent or by 7.5 million tonnes in quantity.