Iron ore price reverses to losses as weakening China steel consumption drags
Apparent consumption of five major steel products slipped by 2.1% week-on-week.
The Carajás complex is located in a remote corner of the Amazon rainforest.
Vale (NYSE:VALE), the world’s largest iron ore producer, continued to flood the market in the first quarter of the year, logging record production volumes despite a current supply glut that has sent prices for the commodity plummeting.
The Brazilian miner produced 77.4 million tonnes of iron ore in the period, up 4.5% from a year earlier. The figure includes 2.9 million tons of ore Vale acquired from third parties, a move that suggests the company is willing to deal with a short-term price pain in order to recover market share after from Australian competitors.
The announcement came just a few hours after BHP Billiton (ASX:BHP), the world’s third iron ore miner, said it would slow its expansion plans because of weak prices.
Vale’s record quarterly iron ore output was due, in part, to the results from the newly opened N4WS mine, in the company’s Carajas complex. The operation kicked off mining activities in December and contributed to an 18% rise in the overall Carajas output for the quarter, the company said.
The market reacted positively to the news. Vale’s shares were trading almost 7% higher to US$6.30 in New York at 10:10 am.
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