Vale lowers iron ore production guidance

Brazil’s Vale anticipates potential setbacks in its production during the rest of 2021 following temporary problems at some of its iron mines. However, company executives say the miner is still on track to improve its performance sequentially in the second half of the year, Kallanish notes.

Vale has revised down its 2021 production forecast from 350 million tonnes to 343mt due to licensing issues at some assets, as well as temporary restrictions on the disposal of mining waste at its Itabira mine.

“During Q2 our production capacity reached 335mt and we expect to operate with an average production of 1 million tonnes per day in the second half of the year,” Vale executive director Eduardo Bartolomeo said during a call with analysts. “So, we remain confident that we will achieve our production target for 2021.”

According to the company’s director of ferrous metals, Marcello Spinelli, if Vale does not add more volumes in H2, it will be producing at the low limit of its guidance.

“Currently, we are operating almost half of the Brucutu capacity, as well as having temporary tailings disposal restrictions due to limited disposal areas in Itabira and licensing issues at the Northern System,” Spinelli commented. “So, we are not saying that we are going to produce 400 million tonnes, we are saying that we have the conditions to increase capacity appropriately and are prioritising quality over volume as a business strategy.”

During Q3, Vale expects to unlock the conveyor belt at Vargem Grande, which should improve iron ore production by almost 6mt. The second crushers’ installation to process jaspilite ores at S11D and the start-up of Conceição’s filtration plant at Itabira is planned for Q4.

Todor Kirkov Bulgaria