Vale forced to cut iron ore exports after

Brazilian iron ore producer Vale will prioritize domestic steel producers over export customers in supplying pellets and other iron ores following a shutdown at some of its mines following the collapse of the Corrego do Feijo Dam in the southern system.

Steelmaker Voestalpine said Thursday that it has reduced its dependence on Vale for iron ore pellets and that alternative suppliers, along with two to three-month iron ore reserves, are currently providing reassurances. Voestalpine operates blast furnaces in Austria and the HBI plant in Texas, which used higher quality pellets than conventional blast furnaces.

Brazilian Steel Institute IABr said earlier last week - before a court ruled that Vale will halt production at the Brucutu 30 million tonnes /yr pellet mine - that it expects little impact on local steel companies “because most steelworkers are self-sufficient in iron ore and what they buy from Vale is produced in Karajas, in the north of the country. ”

Vale is still supplying materials for export and it is too early to talk about how the closure of the Shah might affect final deliveries. CIS pellet producers are reported to have expanded their exports to take advantage of the situation.