RIO DE JANEIRO, Sept. 10 -- Vale SA, the world's second-biggest nickel producer, resumed production at its Thompson mine and refinery in Manitoba after maintenance as world nickel prices declined because of slackening demand.
The plant is now "up and running" after a one-month stop for the scheduled work, Cory McPhee, a spokesman for Vale's nickel unit in Toronto, said today in a phone interview. Output at Vale's two other Canadian nickel mines, at Sudbury and Voisey's Bay, remains halted because of a strike.
Vale stopped operations at Thompson on Aug. 1, the same day a strike halted its Voisey's Bay nickel plant in Newfoundland. Output at Sudbury, Vale's largest Canadian mine in Ontario, stopped on July 13 after a company proposal on benefits was rejected by unionized workers. There are no new talks scheduled.
"The Thompson restart may bring negative sentiment to the nickel market," said Marcos Assumpcao, Sao Paulo-based analyst with Itau Unibanco Holding SA, in a telephone interview. "Nickel is experiencing temporary demand weakness on slightly- higher-than-average stainless steel stocks."
Nickel is a raw material used in the production of stainless steel. London Metal Exchange 3-month nickel prices yesterday stood at $17,950 a ton, 12 percent lower than their Aug. 13 high of $20,605 a ton.
Last year Thompson provided 28,900 metric tons of Vale's Canadian nickel production of 191,700 tons, according to the company's annual production report.
OAO GMK Norilsk Nickel is the world's largest nickel producer.
Vale fell 4 centavos, or 0.1 percent, to 33.75 reais in Sao Paulo trading today. The stock has dropped more than 40 percent this year.