The world’s second-biggest iron ore supplier, Vale, saw production soar in the fourth quarter (Q4) of 2023, exceeding company estimates by some margin.
The Brazilian company achieved its highest monthly output of iron ore since 2018 in December, with copper production also seeing strong results for the quarter.
Iron ore production totalled 89.4 million tonnes (mt) in Q4 2023, up by 11% from the same period in 2022. In 2023, production ended on 321.2mt, exceeding the company’s previous estimates of 315mt, it said in a results statement on Monday.
Accelerated production comes after Vale invested heavily in its Amazonian operations, improving the performance of even its oldest mines in Brazil.
Iron ore prices have recovered by more than a third since mid-August last year, leading some analysts to predict a decline in demand in 2024, although number one producer Rio Tinto still expects to see growth in demand from China.
Vale’s copper production in Q4 totalled 99,100t, an increase of 50% year-on-year and also the company’s biggest quarterly output since 2018. In 2023, production increased by 29% year-on-year, ending on 326,600t, slightly above revised company guidance of 325,000t.
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Strong performance was mainly a result of the successful expansion of the Salobo 3 copper project in Brazil, the company said, with production at the Salobo complex increasing by 87% year-on-year last quarter.
Nickel production in Q4 fell by 5% from the same period in 2022, with an overall decrease of 8% for 2023, although this was expected, with output totalling 164,900t in line with company estimates. Lower production had been anticipated as a result of transitions to underground mining at the Voisey Bay mine in Canada, the company said. Planned furnace reconstruction at the Onça Puma nickel mine in Brazil also slowed output. The latter has faced periods of forced closure in recent years over failures to comply with environmental permits.
Vale told reporters this week it continues to believe in long-term nickel fundamentals driven largely by rising energy transition demand and will move ahead with projects. Its realised price last quarter was 7% higher than futures prices.