Brazilian mining giant, Vale, reported a decline in iron ore output during the third quarter of this year. This decrease was primarily due to equipment failure at one of its operations and a temporary stoppage for maintenance at another facility.
According to Vale's quarterly production report, iron ore output fell by 3.9% in the third quarter compared to the same period last year, amounting to 86.2 million metric tons. However, there was a 9.5% increase in output from the second quarter of this year.
Production of iron ore pellets, which are considered a premium product, witnessed an 11% rise in the third quarter compared to the previous year, reaching 9.2 million metric tons. Additionally, there was a 0.7% increase from the second quarter.
In terms of sales, iron ore saw a 6.6% year-on-year growth in the third quarter, amounting to 69.7 million tons. There was also a 10% increase from the second quarter. On the other hand, sales of pellets experienced a mere 1.1% rise compared to the third quarter of 2022, totaling 8.6 million tons. However, there was a decline of 2.2% from the second quarter.
Vale's Northern System operations witnessed a decline of 1.5 million tons compared to the previous year due to an unforeseen failure of a conveyor belt system. Similarly, production from the Southern System operation fell by 2.6 million tons following a maintenance stoppage of a tailings pipeline.
Interestingly, the average realized price for Vale's iron ore increased by 14% in the third quarter compared to the previous year, reaching $105.1 per ton. In contrast, the average realized price for iron ore pellets declined by 17% during the same period, amounting to $161.2.
These figures highlight both the challenges and successes experienced by Vale in the third quarter. The company faced setbacks due to equipment failures and maintenance stoppages, resulting in a decline in iron ore output. However, they also saw an overall increase in sales and a rise in the average price received for their products.