Brazil: Vale's iron ore production rises 21% q-o-q in Q3CY22, full year guidance unchanged

Brazilian miner Vale recorded iron ore production at 89.7 million tonnes (mnt) in Q3CY2022 (July-September 2022), up 21% as against 74.11 mnt in Q2CY2022 (April-June 2022). The q-o-q upsurge is due to a rise in output in the Southern System.

Production in the Southern System increased q-o-q primarily due to higher third-party buying and additional run-of-mine production and sales from the Paraopeba Complex. In addition, enhanced production at Vargem Grande boosted by several productivity initiatives put in place in the previous quarters also contributed to higher output in Q3.

On a yearly basis, output inched up by 1.1% compared to 88.69 mnt in Q3CY2021.

• Pellet output down 5% q-o-q: Pellet output was recorded at 8.26 mnt in Q3CY2022, down 4.8% q-o-q compared to 8.67 mnt in Q2CY2022. On a yearly basis, output was down by 1% as against 8.34 mnt in Q3CY2021. Pellet production dropped because Vale prioritised production of direct reduction pellets at Oman plants as a result of portfolio optimisation and market conditions.
  
  
• Iron ore sales rise, pellet sales fall - Iron ore sales increased by 7.4% q-o-q to 69.05 mnt in Q3 as against 64.32 mnt in Q2. However, pellet sales fell by 3.6% q-o-q to 8.52 mnt in Q3 compared to 8.84 mnt in the previous quarter.
  
  

Other highlights

• Vale is still keeping an eye on the Minas Gerais rainfall scenario and monitoring its dams in real-time through the Geotechnical Monitoring Centers. It should be noted that none of its structures, which are continuously monitored by inspections, saw a change in the emergency level.
  
  
• Total iron ore production volumes fell slightly by 1.2% to 250.79 mnt in January-September 2022 compared to 253.86 mnt in the same period last year.
  
  
• Vale's iron ore production guidance remains intact at 310-320 mnt for CY2022.
  
  
• Pellet production guidance for this year has been set at 34-38 mnt.