Brazil's National Mining Agency (ANM) said on Thursday that it would halt operations at 47 mining dams that failed to certify their stability, including at least 25 belonging to the world's largest iron-ore producer Vale. The safety of Vale's facilities have been under heavy scrutiny after one of its dam collapsed last year, releasing a torrent of mining waste that killed about 270 people. It was the second Vale dam to collapse in four years. Last October, 54 Brazilian dams failed to certify their stability or file the stability paperwork altogether. Many of the same dams remain on the list and several new dams operated by Vale or its affiliates were added.
Investors have been piling into shares of the world’s largest iron-ore producer, touting it as one of the biggest opportunities to emerge from the carnage in Brazilian markets. Vale sank to a three-year low in March amid the coronavirus outbreak that has disrupted production chains across the globe and sent growth estimates plunging. The stock has recovered about 30% in the past week, but is still trading at levels last seen in 2019 after a dam disaster that killed 270 people.
Brazilian mining company Vale said in a presentation on Tuesday that it expects iron-ore production cuts because of lockdowns imposed globally to control the spread of the coronavirus. Vale calculates roughly 18-million tonnes of output could be interrupted in the transoceanic market. The company also said the pandemic has had limited impact on operations so far, as it has seen no interruptions in Brazilian production or Chinese ports.
Brazilian mining company Vale said on Tuesday it was at risk of postponing the resumption of lost production capacity due to possible coronavirus-related delays in inspections, assessments and authorizations but that existing output so far had seen little impact. The risks, representing a fresh round of upheaval after production cuts last year stemming from the dam burst in the town of Brumadinho that killed roughly 270 people, were detailed in a presentation.
Chinese iron-ore futures picked up in early trade on Tuesday, rising more than 1% on demand hopes after the world's second-biggest economy reported an unexpected growth in its factory activities in March. China's official Purchasing Managers' Index (PMI) jumped to 52 this month from a record low in February, beating analysts' expectations of 45.0, the National Bureau of Statistics said.
The volatility and uncertainty created by the outbreak of the Covid-19 pandemic has scuppered a potential deal that Canadian junior Alderon Iron Ore agreed with a Chinese partner and has now left the company scratching for money to repay a loan due by the end of this month. Alderon said on Thursday that Beijing-headquartered Tunghsu had terminated the previously announced letter of intent to acquire a 26% to 38% interest in the Kami Mine Limited Partnership (Kami LP) for between $15-million and $23-million.
China's first iron ore futures-based exchange traded fund (ETF) has raised $11-million from institutional investors and clients at private banks, according to the manager of the fund, which will list in Hong Kong on Friday. The ETF, managed by the Hong Kong unit of Chinese broker Shanxi Securities Co Ltd - Shanxi Securities International Asset Management Ltd - will track the Dalian Commodity Exchange (DCE) iron ore futures index and use its closing price on March 20 as a benchmark.
ASX-listed Strike Resources has tipped Utah Point, at Port Hedland, as the preferred port destination for its Paulsens East iron-ore project, in Western Australia. A trade-off study focused on Port Hedland, which has existing infrastructure that could be used to bring Paulsens East into production, identified Utah Point as the preferred destination.
Vale SA is tapping into $5-billion in credit lines to boost its cash position as the coronavirus pandemic forces cutbacks at a time when the iron ore producer was working to recover from a dam collapse last year. Vale asked banks to disburse the lines in two tranches, with $2-billion due in June 2022 and $3-billion due in December 2024, according to a statement filed to Brazil’s securities regulator. The company said the decision was made given the risk presented to its business by the pandemic, adding that it’s “prudent” to have more cash in hand “in the next few months.”
Iron-ore major Fortescue Metals on Monday said that it would continue to operate its mine sites in the Pilbara, despite the Western Australian government implementing strict border controls that would require all new inter-state arrivals to self-isolate for a period of 14 days. “Fortescue has been working closely with industry and government on the impact of travel restrictions on the resources sector. We commend the Western Australian state government on their decisive action to contain the spread of Covid-19 in our community,” said Fortescue CEO Elizabeth Gaines.