Vale to open shuttered Alegria mine, starting to restore lost output
Miner Vale SA said on Friday it had been authorized by Brazilian regulator ANM to resume operations at its Alegria mining site, which were interrupted last March after a “stress test” failed to guarantee its stability.
In a securities filing, the company said the resumption of mining activities at Alegria will allow the iron ore exporter to restore 8 million tonnes of 50 million in capacity lost after the collapse of its Brumadinho dam in January caused a series of shutdowns.
Before the shutdown, Algeria had an annual capacity of 10 million tonnes.
The mine’s resumption will add up to 1 million tonnes to production volumes in 2019, but should not impact sales this year, which the company still expects to come in between the lower and midpoint of its previously announced range of 307 million to 332 million tonnes.
Vale shares rose 2.7% during Friday trading as BTG Pactual analyst Leonardo Correa called the resumption “yet another de-risking event” for the company, reiterating his “buy” rating.
Separately on Friday, Brazil’s Foreign Trade Secretariat said iron ore exports had fallen 16% in October from a year earlier to 31.2 million tonnes, although they were up 15% from September.
Prices also slipped, to $62.9 per tonne from $68 the month before, although they were still up substantially from the year-ago price of $55.7.
(By Gabriela Mello, Christian Plumb and Marta Nogueira; Editing by David Evans and Grant McCool)