Vale expressed concern that iron ore prices could come under pressure with mills across the globe either curtailing or halting production, according to media reports. Brazil-based Vale is the worlds largest miner of iron ore. Around 15mn mt of steelmaking capacity has been hampered globally due to COVID-19 lockdown measures, estimates Vale.
European steel mills Thyssenkrupp, Tata Steel, ArcelorMittal and Viohalco have announced production cuts to match a slump in demand and labour challenges due to the COVID-19 pandemic. Steelmakers have cited delays in deliveries and lack of orders from the automotive and construction sectors as major reason for production cuts. Other steelmakers like the Beltrame Group in France; Tenaris-Dalmine in Italy; Salzgitter in Germany; and Voestalpine in Austria, have either cut production or suspended operations amid diminishing demand and a struggle to transport raw materials. In the UK, primary steelmakers, including the Jingye Group-acquired British Steel and other blast furnaces, have been forced to stop operations.
in March, prices of iron ore in Brazil and China markets have been rangebound between $101-104/mt. These were largely supported by lower supply from Australia, Brazil and China. Though supply chains remain disrupted prices are pressured by a lack of demand due to the expected economic impact of the pandemic. China, where the virus outbreak was first reported, has returned to the market with near-normal production levels. But barring China, production in other Asian markets like Japan, South Korea remains hampered.