Iron ore exports from Australia's Port Hedland climbed to an all-time high in June as miners in the largest shipper increased low-cost output, hurting the outlook for prices as steel production slows in China.

Total shipments jumped 14 per cent to 38.4 million metric tons last month from a year earlier, according to the Pilbara Ports Authority. That exceeded the previous record of 38 million tons in May, according to authority data compiled by Bloomberg. Exports to China were 32.6 million tons in June, also a record.

The surge in cargoes from Australia and from Brazil, which reported that June's shipments were the highest this year, may hurt prices that rallied in the second quarter. Supply growth in Australia will accelerate this half, according to UBS Group, which said on Thursday that prices were expected to drop as Rio Tinto Group expanded facilities and a new mine backed by billionaire Gina Rinehart started operations.

"This is just further evidence the majors are continuing to push the tons," Paul Gait, an analyst at Sanford C. Bernstein & Co in London, said after the port released the June shipment figures. "Clearly, that's bad for prices, there's no way that could be interpreted positively."

Exports of iron ore from Port Hedland totalled 220.8 million tons in the first six months, 13 per cent more than a year earlier, according to Bloomberg calculations. Shipments to China from the Western Australian port expanded 16.5 per cent to 186 million tons over the same period, the data showed.

Ore with 62 per cent content delivered to Qingdao, which bottomed at $US47.08 a dry ton on April 2, dropped 6 per cent to $US55.63 a ton on Thursday, the biggest decline in a year, according to data from Metal Bulletin Ltd. The benchmark rose 16 per cent in the three months through June after exports from Australia and Brazil missed expectations.

Shipments from Australia may expand 10 per cent next year, more than twice the pace that's forecast for 2015, the government said on Tuesday in a quarterly forecast, citing additional supplies from Rinehart's Roy Hill, as well as expansions by producers including Rio.

Overseas sales from Brazil, the second-biggest exporter, surged to 32 million tons in June, according to the trade ministry. That compared with 29.55 million tons a year earlier.

Port Hedland is the world's largest bulk-export terminal. The facility handles cargoes of iron ore from BHP Billiton and Fortescue Metals Group, Australia's largest producers after Rio Tinto.

Prices are expected to drop to average $US50 a ton in the second half, according to UBS, which raised its full-year price forecast to $US56 from $US50, citing the disruptions to supply seen in the first six months. Citigroup sees prices dropping to less than $US40 a ton in the fourth quarter as supplies increase.