Brazil: Vale Fails to Receive Safety Clearance for 17 Structures

Vale disclosed the renewal of 80 operational structures which expired on 31st Mar'19. The structures have received Stability Condition Declarations ("DCE"). Another 13 dams and 4 dikes did not receive the certificate, with seven of them being upstream tailing dams. However, the loss of DCE's of such dams will neither impact the safety factor nor the iron ore & pellet sales forecast for 2019. Last week, Vale slashed 2019 iron ore sales forecast by 20% (75 MnT).

The non renewal at Sul dam will only impact the operations of the Brucutu mine, due to eventual discharges from its concentration plant into the Sul Dam. Consequently, Brucutu will not resume its operation within the timeframe estimated.

Towards early Feb'19, Vale had shut operation at its Brucutu mines, causing a production loss of about 30 MnT pa. The move was a step ahead towards safety after iron ore producer underwent collapse at its dam at Corrego do Feijao mine in Minas Gerais in Brumadinho, Brazil on 25th Jan'19.

Vale achieved CY18 production guidance

Vale's iron ore and pellet production of CY18 witnessed in line with the laid guidance at 390 MnT for iron ore and 55 MnT pellet. The total iron ore production witnessed at 384.6 MnT (up 5% Y-o-Y) and pellet production recorded at 55.3 MnT (up 10% Y-o-Y).

Iron ore & pellet sales increased in CY18

Vale recorded iron ore sales at 308.99 MnT, rise of 6% on yearly basis as compared to 291.35 MnT in CY17. The iron ore sales for Q4CY18 recorded at 80.5 MnT, down 4% against 83.98 MnT a quarter ago.
Pellet sales in CY'18 witnessed by the company at 56.59 MnT, up 9% as compared to 51.78 MnT in CY17.