Fire at Vale’s terminal to cast doubt on company’s iron ore guidance

Wednesday, 20 January 2021 00:58:06 (GMT+3)   |   Sao Paulo

A fire at a Vale’s terminal last week may cast doubt on the company’s ability to deliver on its iron ore guidance, a report by BTG Pactual said. BTG’s comments comes after Vale reaffirmed the terminal is operational and that iron ore exports should continue as usual.

Vale’s output guidance for 2021 is to produce between 315 to 335 million mt of iron ore.

“Now we have more questions than answers, but clearly there could be consequences for the iron ore market and its prices in the future,” analysts Leonardo Correa and Caio Greiner said.

BTG Pactual estimates Vale’s iron ore production this year to reach about 320 million mt, but chances of an actual decrease in guidance are growing. The analysts said an eventual reduction in Vale’s guidance could affect iron ore prices.

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