Home Business The Largest Producer of Iron Ore Steps on the Accelerator

The Largest Producer of Iron Ore Steps on the Accelerator

The company Vale plans to grow despite the contraction of prices and the poor economic prospects of the largest consumer

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The company Vale SA, of Brazil, the world’s largest iron ore producer, plans to grow despite the contraction in prices and the unfavorable economic outlook of the largest consumer.

wants to increase the annual capacity of S11D, the largest open pit iron ore mine, and pellet production mainly in its southeast system. Vale also plans to develop operations in Malaysia and Oman.

Taken together, the expansion plans, presented on Tuesday by key executives on the day of the investor in New York, gave the impression of a sudden acceleration. After the US $ 14 billion projects in the Amazon jungle began making its first shipments in 2017, Vale said it would decelerate investments while gradually reducing its huge debt burden.

Subsequently, China’s campaign to reduce air pollution boosted the demand for higher-grade iron ore, the type that is extracted in S11D, which generates less emissions. The company is now producing iron ore at record levels and most of the material is paid at higher prices. The miner, based in Rio de Janeiro, announced on Tuesday that it plans to raise high-grade production to 95 percent of the total by 2022, compared to about 80 percent today.

“Vale’s ore is considered a green, green mineral because of the lower emissions,” said Vale’s chief executive, Fabio Shvartsman, during the company’s annual presentation with investors. Steel production “is probably the most important source of pollution in all of China .”

Vale said on Tuesday it plans to invest US $ 770 million in S11D and in the northern logistics that serves the project, as well as an additional US $ 820 million in its southeast system. Its objective is to increase the annual capacity of S11D from the 90 million tons forecast for 2020 to 100 million tons two years later, while the production capacity of pellets in the southeast will increase by 20 million tons in the long term. It also plans to complete an increase of 10 million tons through a tailings dam recovery project in northern Brazil.

When it comes to basic metals operations, Vale also sings a different melody. Schvartsman, who was initially skeptical about Vale’s performance in the sector, now firmly believes in the future demand for key metals for the electric car battery revolution.

The head of the company announced that he planned to go ahead with an investment to keep the distressed nickel mine in New Caledonia operational despite having previously said he could put the unit in care and maintenance if he could not find a partner.