Vale sees iron ore prices above $85 a ton despite tariff turmoil
me-metals: Vale SA (NYSE: VALE), one of the world’s top iron ore producers, dismissed analysts’ predictions that prices of the steelmaking material will tumble below $85 a ton amid a tariff-fueled economic slowdown.
According to me-metals cited from mining.com, “Below $90 a ton there will be a very significant percentage of global production that will be under water, that will lose money, and probably stop producing,” Chief Financial Officer Marcelo Bacci said in a press conference Friday after the company reported first-quarter earnings that missed estimates. “This generates a price improvement effect.”
Analysts from Goldman Sachs Group Inc. and data provider Mysteel Global have said prices could slip below $85 a ton by the end of the year as tariff-related uncertainties put further pressure on prices.
Vale still sees solid demand for its flagship product from China, a market that accounts for 60% of its sales. Bacci said he’s confident that iron ore prices will stay around $100 per ton with stable supply and consumption.
Rio de Janeiro-based Vale has been adopting a strategy of maximizing value by offering a flexible portfolio to suit its clients’ demands. With steel mills navigating a challenging moment, customers aren’t always paying a premium to buy higher-quality ore. The Brazilian company said it plans to launch a mid-grade product using iron ore out of Carajas, a region of Brazil where the company has its most prized operations.
“This is much more appropriate to what the market is looking for,” Rogerio Nogueira, Vale’s commercial executive vice president, told investors on the call Friday. The company expects to present the new product to the market in the next 12 months.
source: mining.com
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