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Energy

Brazilian miner Vale hints at fourth-quarter production boost

FILE PHOTO: The logo of Vale SA is pictured in Rio de Janeiro, Brazil, August 7, 2017. REUTERS/Ricardo Moraes/File Photo

RIO DE JANEIRO (Reuters) - Brazilian mining company Vale SA VALE3.SA reported on Monday an increase in iron ore output in the third quarter and predicted a further boost in fourth-quarter output at some units, as a number of mines ramp up production or come online.

In a securities filing, the company said it produced 88.7 million tonnes of iron ore in the quarter, up 31.2% from the previous quarter and up 2.3% from the same period a year before, boosted by increased output at its Itabira and Timbopeba complexes and its Fazendao mine, all in southern Brazil.

Production at Itabira was temporarily stopped in the second quarter due to to a coronavirus outbreak among workers, while Itabira and Fazendao had been dogged by regulatory issues.

While the company managed to boost iron ore output, it still has a long way to go to reach its annual goal of 310 million to 330 million tonnes. Through the third quarter, it had produced 216 million tonnes.

Vale said in the Monday statement that 6 million tonnes of iron ore output at its Serra Leste mine in northern Brazil would come online in the fourth quarter. It added that some logistical issues in the iron ore pellet and fines market had been resolved in September, which would allow for improved timing between production and sales in that segment in the fourth quarter.

Nickel production, Vale said, came in at 47,100 tonnes, down 20.7% from the previous quarter and down 8.4% from the same period in 2019, hit partially by maintenance work.

The company said that nickel and copper output were already increasing in the fourth quarter, as maintenance work drew to a close. Its output of the metal at Voisey’s Bay and Onca Puma should also improve, the company said, thanks to decreased coronavirus-related work stoppages and the completion of maintenance projects, respectively.

Reporting by Gram Slattery, Roberto Samora; additional reporting by Sabrina Valle; Editing by Chris Reese and Lisa Shumaker

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