Vale increased iron ore production by 6% y/y in the first half of 2023

In January-June 2023, Brazil’s largest mining company Vale increased iron ore production by 6% compared to the same period in 2022 –  up to 145.52 million tons. It is reported on the company’s website.

The production of iron ore pellets for January-June 2023 increased by 11.8% compared to the same period in 2022 – up to 17.43 million tons.

Vale produced 78.74 million tons of iron ore in the second quarter, up 17.9% from the first quarter of this year and up 6.3% from the second quarter of 2022. Production of iron ore pellets during this period increased by 9.5% q/q and 5.1% y/y – up to 9.11 million tons.

«Half-year iron ore output increased thanks to record production in the second quarter of the S11D mine and strong performance at the Itabira and Vargem Grande complexes, which improved the average quality of the company’s product portfolio. Pellet production increased due to increased production at the Tubarão plants,» the company notes.

Sales of iron ore in January-June 2023 amounted to 114.1 million tons, and pellets – 15.85 million tons, which is 4.3% less and 6.9% more, respectively. In the second quarter, Vale sold 63.33 million tons of iron ore, which is 38.1% more q/q and 0.9% y/y. Pellet sales were up 8.3% q/q, but down 0.4% y/y – up to 8.81 million tons.

«Iron ore and pellet sales recovered in the second quarter thanks to the resumption of operations at the Ponta da Madeira terminal after limited capacity in the first quarter due to adverse weather conditions,» the company said.

In the third quarter, Vale expects a narrower gap between product production and sales by reducing first-quarter inventories.

In 2023 the company plans to extract 310-320 million tons of iron ore. The production of pellets is planned at the level of 36-40 million tons.

Vale is one of the three largest mining companies in the world. In 2022, the company reduce iron ore production by 2% compared to 2021 – to 308 million tons. Sales of iron ore fell by 3.8% y/y – to 260.7 million tons. Production of pellets increased by 1% y/y – up to 32 million tons, and sales – by 2.7% y/y, up to 33.2 million tons.

In 2022, Vale planned to start producing iron ore at the level of 310-320 million tons and produce 34-38 million tons of pellets.