Brazilian iron ore mining giant Vale reported Wednesday that net earnings of $4.9 billion in Q3 2011 were down from $6.04 billion in Q3 2010 and about 23 percent lower than Q2 2011 due in part to a financial loss of $2.19 billion because of the severe depreciation of the Brazilian real against the US dollar. The decline in earnings comes despite record sales of bulk materials such as iron ore, pellets and metallurgical and thermal coal in Q3, which totaled US$12.8 billion, a 9.3 percent climb from the previous record reached in Q2 2011. Iron ore production rose 6.4 percent in Q3 to 87.9 million metric tons.
Despite a decline in iron ore prices recently, Vale still expects prices to remain high for a long period of time as the global iron ore market will continue to be strong, the company said in a statement during the earnings release conference call.
During the call, Vale also acknowledged that because of environmental licensing issues, Vale's investments so far in 2011 are much lower than previously anticipated. Vale invested 47 percent of the $24 billion in investments it had planned to distribute in 2011 over the first nine months of 2011.