J. Mendes group said in a statement that its subsidiary JMN Mineração has suspended operations at its iron ore mine located in the state of Minas Gerais, between the municipalities of Deterro and Piracema.
Citing low iron ore prices and high logistics costs, mainly due to the freight rate between Brazil and China, the company follows the example of Itaminas, CSN Mining, Cape Verde and Usiminas Mineração.
Although it does not ship iron ore by sea to China, JMN's costs of shipping iron ore by sea have been affected, as its domestic customers base local prices on international benchmarks.
According to ship broker Banchero Costa, the Tubarao-Qingdao freight rate, a benchmark for iron ore shipments from Brazil to China, currently stands at $33.20 dollars per metric ton, up 41.4 percent from the same period last year, driven by higher bunker fuel prices caused by the war in the Middle East..
The group also owns the Ferro+ Mineração iron ore mining facility, which produces 7 million tons per year, while JMN's production capacity is estimated at 2 million tons per year.
There are no comments yet.