With the announcement by the Brazilian miner Vale that its Brucutu mine will restart operations, iron ore prices have stopped an uptrend that has lasted for four weeks.
With the restart of operations at Brucutu, which had been idled as indirect consequence of the collapse of the Brumadinho waste dam in January, Vale believes that it will increase its iron ore production by 30 million mt, on annualized basis, reducing previously announced production losses of 92.8 million mt in 2019.
With all the uncertainties surrounding the operations of Vale, including rains affecting shipments at its operations in the northern region of Brazil, the company unveiled expectations of combined iron ore and pellets sales in the range of 307million mt to 332 million mt in 2019.
With stable sea freight rates, neutral to FOB quotations, coupled with the reduced quotations of the ore in the Chinese spot market, iron ore prices in Brazil have declined by $1/mt on a weekly basis.
Sinter feed fines of 65 percent iron contents are estimated to be traded for export from Brazil at $85/mt, the equivalent lumps at $109/mt and blast furnace grade pellets at $151/mt, FOB conditions.
In the Brazilian domestic market, for equivalent ores, the prices are $79/mt for sinter feed fines, $103/mt for lumps and $145/mt for blast furnace grade pellets, ex-works, no taxes included.
Preliminary indications by the Brazilian customs authorities point to a sharp reduction, in April, from the 22.18 million mt of combined iron ore and pellets exported in March.