Iron ore weakness to continue into 2025 and beyond, says Fitch Solutions’ BMI
Looking beyond 2024-2025, BMI analysts maintained their view that iron ore prices will likely follow a multi-year downtrend.
Vale (NYSE: VALE) and Latin America’s largest port have signed an agreement to study the potential construction of a facility in Rio de Janeiro state that would produce low-carbon iron ore products.
The plan is to develop a hot briquette iron (HBI) plant that would make high iron content compact bricks to supply steel mills.
The use of HBI in blast furnaces can decrease greenhouse gas emissions by about 25%, with even greater potential reductions along the supply chain.
The complex with at least one plant could attract $1 billion for the construction of an HBI plant, and start operating at the port by 2028 with an annual HBI output capacity of around 2.5 million metric tons, according to Prumo Logistica, the firm that runs the Port of Açu.
The industrial complex should initially receive pellets from Vale.
“We already have a letter of intent from HBI buyers in Brazil (that) already justifies more than one plant, perhaps two plants in Brazil,” Rogerio Zampronha, the chief executive of Prumo Logistica, told Reuters.
He added that another letter of intent will likely to be signed “soon.”
The HBI production would likely be powered by natural gas in a project led by Norway’s Equinor possibly serving as a key supplier of the fuel, according to Prumo.
