Heavy Rains Dampen Vale's Q1 Iron Ore Output

Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--Brazilian miner Vale S.A. (NYSE:VALE) (Rio de Janeiro) registered a stronger year-on-year output for nickel and copper in the first quarter, though all its mineral outputs were lower than the previous quarter.

Vale had a weaker first-quarter output due to heavy rainfall in Brazil that impacted its iron ore operations. Between January and March, the mining company had an iron ore output of 67.7 million metric tons, a drop of 4.5% compared to last year and 20.7% less than in the previous quarter.

The lower production volumes resulted from heavy rainfall impacting operations in its Northern System, home to its largest iron ore assets. As a result, combined output from the two mines in the Northern System was 2.6% lower compared to first-quarter 2024 and 32.7% below the volumes registered in the fourth quarter of last year.

Besides the impact of rainfall, the Serra Norte mine in the Northern System was hit by licensing restrictions. The iron ore volumes could have been lower, though the S11D mine had the strongest production pace in Q1 with 19.3 million metric tons. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Plant Database can read profiles on the Serra Norte and SIID mines.

Meanwhile, the Southeastern System also had lower production, given a 49-day corrective maintenance work at the Caue Pellet Plant. However, the commissioning of the Capanema project in 2024 and its progressive ramp-up are helping the company offset some of the losses. Capanema is expected to be fully operational by Q1 next year. Subscribers to the GMI Project and Plant databases can click here for a profile on the Caue mine and here for the Capanema project report.

The company's Southern System was also lower due to strategic decisions, though it is ramping up its VGR1 project, which will be fully operational in Q2 next year. Subscribers can click here for the project report.

Vale's iron ore production guidance for 2025 ranges from 325 million to 335 million tons.

The company's pellet output dropped to 7.1 million metric tons in Q1, about 15.2% less than during the same time last year and 21.6% lower than the previous quarter. This was partly the result of lower production from the Tubarao plants, which were impacted by the operations in the Northern System. The heavy rainfall affected the pellet feed's moisture, and therefore, the plants' performance.

However, copper output was 11% higher year-on-year, reaching volumes of 90,900 metric tons in Q1, but 10.7% lower than in the previous quarter. This was the outcome of solid operations at the company's Salobo and Sossego mines in Brazil and its assets in Canada. Subscribers can read more information on the Salobo and Sossego mines.

This year, Vale has set a copper production guidance between 340,000 and 370,000 metric tons.

Nickel production in the first quarter increased by 11.1% compared to the previous year, reaching 43,900 metric tons. However, this figure represented a 3.5% decrease from the previous quarter. This decline was partly due to a timing mismatch between the mined and refined materials at the Sudbury asset.

This year, the company expects to produce between 160,000 and 175,000 tons of nickel.

Subscribers can click here for a list of projects mentioned in this article, and click here for a list of mines.

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