Vale restarts Guaiba iron ore terminal

Brazilian iron ore mining company Vale restarted its Guaiba island iron ore terminal in Rio de Janeiro state on 17 March, where operations had been suspended since 11 March.

Mangaratiba city had shut down operations at the terminal for the second time this year, as the fatal tailings dam collapse at Vale's Feijao iron ore mine on 25 January has increased the Brazilian government's focus on the company's operations.

Vale has obtained a court order to restart operations, reiterating in a statement that it has the necessary licences and approvals to operate the terminal. Guiaba is among the company's main ports for iron ore exports. Vale shipped 46.5mn t of iron ore from the terminal in 2016, according to an SEC filing by the company in the US.

The restart of Guaiba operations may pressure iron ore prices. The Argus ICX 62pc index has increased by 5.57pc since the terminal was shut down on 11 March. The terminal shutdown was followed by the suspension of operations at Vale's 12.8mn t/yr Timbopeba mine yesterday, following a court order. Vale has suspended operations at over 80mn t/yr iron ore mining capacity since the 25 January accident.

Vale is expected to increase iron ore output at its high-grade iron ore mines in Carajas region over the year to partly plug the shortfall in supplies from Minas Gerais province where the Feijao accident occurred. But global seaborne supplies are likely to lag demand this year as a result of lower Vale output, which should support prices during 2019.