Steel Products Prices North America
February 24, 2019
CRU: Lower Iron Ore Supply to Affect Pig Iron
Written by Tim Triplett
By CRU Latin America Analyst Thais Terzian
On Jan. 25, one of Vale’s tailing dams located in Brumadinho, Minas Gerais, breached. The dam was part of Vale’s Córrego do Feijão mine and its breach tragically caused the death of several hundred people. On Jan. 29, Vale announced the suspension of production at nine mines in its Southern System. The total production loss in this system could be 40 Mt/y. While Vale is expecting production to resume at most of these sites within three years, we do not expect Vale to be able to replace all 40 Mt/y of lost production from other sites in the interim. In addition, the state court in Minas Gerais ordered the suspension of operations at eight tailings dams on Feb. 4, which has forced the idling of the Brucutu mine and beneficiation plant in Vale’s Southeastern System, removing an additional 30 Mt/y of production from the market.
