On Thursday, Vale said that it would be suspending operations at three of its iron ore pellet plants in Brazil. Vale said that less pellet production will be substituted with increased production of sinter feed due to "a change in the composition of steel industry demand for raw materials throughout the cycle, where there is a contraction in pellet consumption in favor of greater use of sinter feed."
Vale will temporarily halt operations at the São Luís (Maranhão state) and Tubarão I and II (Espírito Santo state) pellet plants, starting from October 8 and November 13, 2012, respectively. The aforementioned plants were responsible for the production of 4.926 million metric tons of pellets during the first half of 2012, accounting for 18.3 percent of Vale's total. Employees at these plants will be reassigned to other operational activities at Vale.