SMM news, local time October 14 Vale (Vale) released the third quarter of 2019 industry report, the report said that Vale iron ore powder production and sales increased significantly, on the one hand, thanks to the continued resumption of production in the southern and southeastern systems, on the other hand, thanks to the strong operational performance of the northern system and the return of shipments to normal. In the third quarter of 2019, iron ore powder production (including third-party procurement, raw ore and pellet concentrate production). ) reached 86.7 million tons, an increase of 35.4 percent over the previous quarter. The resumption of production in the Brookutu (Brucutu) mining area announced in June and the partial resumption of dry mineral processing operations in the Dawalren (Vargem Grande) comprehensive mining area announced in July have contributed to this quarter's output.

Resumption of iron ore production in shutdown operation

Source: VALE

Of these, the northern system performed strongly in the quarter, with production reaching 55.4 million tons, up 33.3 per cent and 2.7 per cent from the previous quarter and the same period last year, respectively. Among them, the S11D mining area set a record output of 20.4 million tons after successfully reaching production. Vale expects production at the S11D mine to reach 90 million tons by 2020.

In the third quarter of 2019, Vale pellet production, including production achieved with third-party capacity, reached 11.1 million tons, an increase of 22.7% over the previous quarter, mainly due to maintenance of the pellet plant in the previous quarter and a pick-up in production this quarter; the resumption of production in the Brukutu mining area has improved the quality of pellet fine powder supplied to the Southeast system pellet plant. On September 26, 2019, Vale adjusted its pellet production to 43 million tons from the previously announced 45 million tons, based on a strategy in which benefits take precedence over production and current market conditions. Thanks to these resumption factors, sales of iron ore powder and pellets reached 85.1 million tons in the third quarter of 2019, up 20.2 per cent from the previous quarter. Vale reiterated that the guided sales of iron ore and pellets in 2019 were in the range of 307 million to 332 million tons, and the current expectations for sales were close to the middle of that range.

Source: VALE

According to the summary of production in the third quarter of 2019, iron ore production in the third quarter was more than 30% higher than in the second quarter, but it was still 17.4% lower than in the third quarter of last year. With the passage of time, the impact of the dam break at the beginning of the year is also diluted, and the main mining areas affected are recovering one after another. As the world's leading supplier, the recovery of Vale iron ore production is bound to continue to ease the pressure on the supply side of iron ore. Vale is expected to restore its remaining production of about 50 million tons by the end of 2021, and a number of phased targets have been achieved, in addition to progress, including approval to conduct trigger tests on the resumption of dry mineral processing operations in mining areas and authorization of trigger tests on TFA railway terminals, which is an important step in eliminating logistics bottlenecks in the Dawalren integrated mining area. Vale's iron ore is mainly produced domestically, while the accident earlier this year occurred in an iron ore waste mine in the Brazilian state of Minas Gerais. Local mines are directly affected, while the surrounding areas are affected to varying degrees. With the continuous resumption of production in the mining areas of Vale, the production level should be restored in about 2 years.

Analyst Andrew Cosgrove (Andrew Cosgrove) said: "Vale's growth, coupled with increased year-on-year shipments of Rio and Billiton in 2020, means a small surplus in iron ore next year."

Let's take a look at Vale's quarterly production since the dam break:

Vale released information for the first quarter:

In the first quarter of 2019, Vale iron ore powder production was 72.9 million tons, down 28 per cent and 11 per cent respectively compared with the same period last year, mainly due to the follow-up effects of the Bloomadiu dam break and the unusually strong seasonal climatic factors.

In the first quarter of 2019, Vale pellet output was 12.2 million tons, down 23 per cent and 5 per cent, respectively, compared with the same period last year, mainly due to the closure of some pellet plants after the Broomadiu dam break and the planned maintenance of the Tubarang and Oman pellet plants.

Information released in the second quarter shows:

In the second quarter of 2019, iron ore powder production reached 64.1 million tons, down 12.1 per cent and 33.8 per cent year-on-year, respectively, mainly due to the subsequent impact of the Bloomadi Dam break, as well as abnormal weather conditions in the northern system in April and early May.

In the second quarter of 2019, Vale pellet production was 9.1 million tons, down 25.5 per cent and 29.3 per cent, respectively, compared with the same period last year, mainly due to the complete shutdown of the southern system pellet plant in the wake of the Bloomadiu dam break, abnormal rainfall in the northern and south-eastern systems and maintenance of the Tubarang area pellet plant.

"Click to sign up for the first Shanghai Forum on China Mining Industry

Scan QR code and apply to join SMM metal exchange group, please indicate company + name + main business