Brazil -world’s second-largest iron ore exporter recorded a sharp rise in its monthly iron ore export volumes in Sept’20. Export volumes stood at 37.9 mn t in Sep’20, up 21% as against 31.3 mn t in Aug’20, according to trade statistics released by Brazil customs. The exports for the month stood over 4.5 years high as the levels were last witnessed in Dec’15 at 39.5 mn t. The significant rise is due to the rise in Vale’s pace of production and increase in Chinese demand.
The increased Chinese infrastructure spending, and restocking ahead of golden week holidays in October favored the price rise. Also, the recovering demand in Europe, Japan and South Korea pushed up the exports. The surge in Chinese futures also supported spot price rise.
On a yearly basis too, exports increased 19% as compared to 31.9 mn t in Sep’19.
Brazil iron ore export prices up 8% m-o-m in Sep’20: The average price of iron ore exported from Brazil for Sep’20 witnessed an 8% rise on a monthly basis to $81.7/t, FoB Brazil as against $75.6 in Aug’20. On a yearly basis too, the average price of iron ore in Sep’20 rose as compared to Sep’19 price at $65/t, FoB Brazil.
Key updates:
- Vale resumes operations at Viga plant – On 2nd Oct’20, Vale resumed the operations of Viga concentration plant, after a 6-day of stoppage. It has a production capacity of 11,000 t fines per day. Earlier on 24th Sept’20, the miner announced the suspension of operations at its Viga plant in compliance with the decision by the judge of the Court of Entre Rios de Minas district regarding the Public Civil Action filed by the municipality of Jeceaba.
- Vale targets 450 mn t iron ore capacity pa – In an investor presentation held in mid-Sept’20, the company officials highlighted their plans of increasing Vale’s iron ore production capacity to 450 mn t pa. However, it did not give the timeline for it. The company has set iron ore guidance at 310-330 mnt for this year
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