Canada's largest mining company, Iron Ore Co. of Canada (IOC), has announced that it is cutting production at its mines and is reconsidering its plans to increase capacity by 50 percent by 2011.
The company will shut down one of its six iron ore pelletizing machines in Labrador City (located in the Canadian province of Newfoundland and Labrador) for a maintenance rebuild, and then shut down another machine for a rebuild. Also, all production, except for the mine and some rail transport and shipping activity, will be suspended for four weeks in July 2009.
Additionally, a US$800 million expansion plan announced last March, which would bring the company's iron ore concentrate production capacity from 17 million to 26 million metric tons, is now under review.
CEO Terry Bowles says, however, that no permanent employee layoffs are planned and that, with the current economic stimulus plans initiated by governments worldwide, the company expects iron ore demand will improve over the medium term.