Vale suspends activities at Fábrica mine

Vale has suspended all the activities at the Fábrica mine at its Paraopeba Complex under its Southern System, an industrial source close to Vale confirmed a company release on February 20.

The immediate suspension of activities at the Fábrica mine is in answer to the regional office of the National Mining Agency (ANM) determination in a preventive manner, and together with Fábrica, Vargem Grande complexes also as part of Vale’s Southern System have been halted too, “in order to avoid potential problems triggering failures by liquefaction in the Forquilha I, Forquilha II, Forquilha III, Grupo and Vargem Grande dams”.

Vergem Grande complexes, however, have been halted operations since February 4, and the affection of iron ore was already factor in the 40 million tonnes/year Vale mentioned in the earlier releases.

Fábrica mine is with both mining and a pelletizing plant, and the latest affection is mainly on its fines output, the industrial source confirmed Mysteel Global’s understanding.

Vale does not provide iron ore output by mines, and Vale China media official needs to confirm with the headquarters, so it is hard to assess the affection, though some market sources mentioned 3 million tonnes/year of iron ore output.

No suspension timeframe has been mentioned in Vale’s release, though it mentioned that “it will appeal to the ANM collegiate to allow for mechanical dismantling by tractor and for resuming its concentration and pelletizing plants operations, which will lead to limited impacts on production volumes, whose values will be reported as soon as estimated”.

Vale already disclosed in early February that Fábrica pellet plant will be affected as part of affection of the 11 million tonnes/year pelletizing feeds, as reported. Fábrica pellet plant produced around 3 million tonnes of pellet annually.

The industrial source disclosed that he would expect Vale to issue a press release soon to summarize the affection on its operations so far, as “it is rather confusing to the iron ore community now with so many individual releases”, though he agreed that it is hard to fully assess the impact with many uncertainties on the whole matter.

Since the tailings dam collapses on January 25 at the Feijão mine in Brumadinho in Southern Brazil’s Minas Gerais, market has been assessing the affection on Vale’s iron ore capacities, putting the range at 80-100 million t/y, or up to 25% of the company’s 400 million t/y for the time being, which is higher than Vale’s official estimation.

Written by Hongmei Li, li.hongmei@mysteel.com

Please check the link to the previous story on the estimation with a detailed table:

https://www.mysteel.net/article/5004840/Market-digging-actual-affection-on-Vales-iron-ore-output.html