Last year was a shocker for Vale, with two guidance reductions, and a lower y-o-y run rate (302 Mt) than 2019 (the year the dam at Brumadinho burst). Vale is Brazil's key producer, dominating Brazilian shipments. This year was looking slightly better for Brazil overall- until July.

Brazil's iron ore exports down 7% y-o-y in Jul'21 on lower shipments

Brazil, the world’s second-largest iron ore exporter, recorded a 7% y-o-y fall in its iron ore and pellets export volumes in Jul’21. The volumes stood...

Fines/Lumps

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SteelMint Bureau

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4 Aug 2021, 19:07 IST

Brazil, the world's second-largest iron ore exporter, recorded a 7% y-o-y fall in its iron ore and
pellets export volumes in Jul'21. The volumes stood at 31.7 million tonnes (mn t) in the month
under consideration as against 34 mn t in Jul'20, according to trade statistics released by Brazil
customs.

On a monthly basis, exports decreased by 6% compared to 33.68 mn t in Jun'21.

According to data published by the country's economy ministry, exports dropped on lower overall
shipments and less number of working days in the month. There were 22 working days in Jul'21
compared to 23 in 2020, making the contraction more severe.

Also, iron ore imports from China are expected to see a drop in the coming months due to the
rainy season and weakening steel margins coupled with possible steel output curbs in H2CY'21.

Iron ore export prices pick up in Jul'21: As per data published by the ministry, prices of iron
ore reached an all-time high this year. The average price of iron ore exported from Brazil in
Jul'21 rose to $158.8/tonne (t), FoB Brazil on a monthly basis as against $153.6/t in Jun'21.
On a yearly basis, the average price of iron ore increased significantly as compared to the Jul'20
price of $70.5/t, FoB Brazil.

Vale SA, the second-largest iron ore producer in the world at present, revised down its guidance
for end-2021 production capacity to 343 mn t/annum from 350 mn t announced previously. During
a call with analysts on 29 Jul'21, the company declared that the issues that are hindering
production are licensing problems at the Sistema Norte and Mutuca assets in Brazil as well
as temporary restrictions on the disposal of mining waste at the Itabira mine. However, the miner
has kept its 2021 production guidance of 315-335 mn t unchanged.

The miner recorded total iron ore fines production at 75.7 mn t in Q2CY'21, up 11% as against
68 mn t in Q1CY'21. Production picked up due to several reasons. These include higher volumes
from its Brucutu mine coupled with the increase in high-silica sinter feed production, improvement
in weather-related conditions in Serra Norte, a strong performance from the Serra Leste mine,
higher productivity from the Itabira Complex and wet processing production at the Fabrica mine.

https://www.steelmint.com/insights/brazils-iron-ore-exports-down-7-y-o-y-in-jul21-on-lower-shipments-236733