LaFemina noted that price rises were to be expected on the closure news as the iron ore market was already tight. On June 8, the first trading day after news of the closure, S&P Global Platts assessed the 62% Fe Iron Ore Index at $106.55/dry mt CFR North China, up $5.60/dmt from June 5.
Vale indicated that it had expected to produce 2.7 million mt of high-grade iron ore concentrate and fines per month from its Itabira complex. This 32 million mt/year run rate equates to about 10% of the company's planned 2020 production of 310-330 million mt and compares to an estimated seaborne iron ore market of 1.46 billion mt for 2020, Jefferies said in a note.
Vale said in a June 6 statement that it sees no need to revise its existing full-year guidance due to the Itabira closure. However it noted there could be a temporary shortage of pellets for the domestic market as a result.
