Vale: world’s largest iron ore producer may face temporarily suspension of operations from its Brucutu mines, causing a production loss of about 30 MnT pa. The move is a step ahead towards safety after iron ore producer underwent collapse at its dam at Corrego do Feijao mine in Minas Gerais in Brumadinho, Brazil on 25th Jan’19. Vale said it is appealing the court order on Brucutu as one of the mining dams mentioned in the decision is a different type than the one that ruptured last month.
The 30 MnT output curb is in addition to 40 MnT operation hault previously imposed which includes pellets of 11 MnT pa. Company is looking to compensate this loss by increasing production from the other sites.
At Feijao mine dam 1 collapsed, which used to dispose tailings from ore production and was inactive. The disaster unleashed mining debris into the region resulting in huge loss of life and property especially in the town of Brumadinho.
Following the dam disaster in Brazil, Vale S.A on 29th Jan 2019 through its press release unveiled that, the company is planning to decommission its entire tailing dam built by the upstream method.
Impact of Vale production curbs:
Surge in Global Iron Ore Prices: Following Vale dam tragedy, spot iron ore prices have shot up sharply from end Jan’19 at around USD 75/MT, CFR China to USD 87/MT, CFR China towards early Feb.
Impact on Indian Market: As per the market participants report to SteelMint, iron ore exports turns active from the last few weeks from Odisha. SteelMint’s current assessment for regular grade pellet (Fe 64+/-1%, 3% alumina) export stands at USD 116-117/MT, CFR China which was USD 111-112/MT, CFR China last week. As the global iron ore prices increased, it has attracted the miner for lucrative opportunity in exports for better realization. Although Chinese mills have turned on a holiday mood ahead Lunar New Year holidays, but Indian iron ore companies are hopeful exports after holidays.
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