Vale increases iron ore production to highest level since 2018

Brazilian mining company Vale reached its highest level of iron ore production since 2018 in 2024 – 327.67 million tons, up 2% from a year earlier. Pellets production increased by 1.2% y/y – to 36.89 million tons. This is stated in the company’s press release.

At the same time, in the fourth quarter, production decreased by 4.6% y/y – to 85.28 million tons, while pellet production decreased by 6.9% y/y – to 9.17 million tons.

According to Vale’s forecasts, in 2025, iron ore production will amount to 325-335 million tons, and pellet production – 38-42 million tons. The company noted that 2024 was a period of operational stability and the launch of key projects.

The decline in production in the fourth quarter is due to Vale’s reduction in low-iron ore production at its operations in the Southern region of Brazil.

This also affected sales: in October-December, sales of iron ore products decreased by 10.1% y/y – to 81.19 million tons, as the company decided to reduce the share of high-silica ore supplies. BTG Pactual analysts called this strategy justified, as it allows the company to protect its pricing policy and optimize its product line. In the fourth quarter, the average selling price of Vale’s iron ore concentrate was $93/t, down 21% from 2023 but up 3% from the third quarter.

In 2023, Vale increased its iron ore production by 4.3% year-on-year – to 321.15 million tons. The company’s pellet production increased by 13.5% y/y – to 36.5 million tons.

Iron ore sales in 2023 decreased by 1.5% year-on-year – to 256.79 million tons. At the same time, shipments of iron ore pellets increased by 8.1% y/y – to 35.8 million tons in the period under review.