Vale’s iron ore output totaled 68.0 million tonnes in
1Q21, 14.2% higher than in 1Q20, but down 5.5% compared to 72 million tonnes
average analyst estimate.
According to
the company, the year on year growth is attributed to the
gradual resumption of halted operations in Timbopeba, Fábrica, and Vargem Grande complexes
in Minas Gerais state throughout 2020, stronger performance in Serra Norte in
Pará state, lower rainfall in January, and the restart of Serra Leste operations, also in the Northern System.
The ramp-up means Vale has an outsized impact on
prices in a tight market, especially after Chinese steel output jumped in
March.
Performance was partially offset by scheduled
maintenances in S11D, and lower performance in the Itabira complex related to
tailings disposal restriction in the complex.
Vale reported 19.5% quarter-over-quarter decline in
production, mainly attributed to usual
seasonality.
VALE, WHICH IS ALSO THE
BIGGEST PRODUCER OF MINED NICKEL, PRODUCED 4.7% LESS OF THE METAL THAN A YEAR
AGO
This year, Vale is expected to account for 83% of
global supply growth, according to BloombergNEF.
Vale declared a production capacity of 327 million
tonnes per year. In 2018, before the Brumadinho dam collapse,
Vale produced 385 million tonnes.
The miner maintained its full-year guidance between
315-335 million tonnes of iron ore.
The company said last year it expects to reach an iron ore capacity of 400 million tonnes per
year by the end of 2022 or early 2023.
Vale’s pellet production totalled 6.3 million tonnes
in 1Q21, 9.2% lower than in 1Q20, as a result of lower pellet feed availability
from Vale’s sites mainly from Itabira and Brucutu.
Despite a weaker quarter, Vale expects to gradually
increase production during 2021 with the higher availability of pellet feed
from Timbopeba and Vargem Grande.
Sales volumes of iron ore fines and pellets totalled
65.6 million tonnes in 1Q21, up 11% y/y on stronger iron ore production, but
partially offset by lower pellet-feed availability.
Vale, which is also the biggest producer of mined
nickel, produced 4.7% less of the metal than a year ago, excluding New
Caledonia operations the company sold.
The company’s copper production was 19% down over the
same span due to maintenance that was slowed by covid-19 related restrictions
on contractors.
In coal, Vale has concluded a revamp of two
processing plants in Mozambique after announcing its intention to exit the coal business.
Mining.com (With files from Bloomberg)