Brazilian iron ore producer Vale said on Wednesday it may “provisionally” suspend activities at its Malaysian iron ore distribution center, the Teluk Rubiah maritime terminal.
Vale’s announcement follows a Malaysian government decision for a lockdown from March 18 until March 31, during which all travel and non-essential businesses will be forbidden.
SteelOrbis reported that most miners in Malaysia, including iron ore producers, have already stopped operations, while BF-based steel mills have also been forced to reduce work to a minimum.
Vale didn’t specifically mention the likely halt is due to any government-related decision. However, it said it is in touch with the local government to “clarify allegedly restrictions imposed by the local government to transportation between cities, which could limit the workers’ access” to the Malaysian iron ore distribution center.
Vale indicated the decision that might result in the halt of the Malaysian iron ore distribution center is due to the Covid-19 outbreak and the company’s protective actions to aid its employees.
Vale said that if a halt is confirmed, it would redirect vessels from the Malaysian distribution center to its other blending facilities in China, with “no sales or production volumes impact expected for full-year 2020.”
The company said, however, sales volumes should be negatively impacted in Q1. “An irrelevant cost increase is expected due to the additional logistics (to move blending to China),” Vale said.