Vale SA (ADR) (NYSE:VALE), a Brazilian mining firm, has announced on Wednesday the record production of iron ore at 74.5 million tonnes in 1Q2015 despite a drop in prices.
The largest producer of iron ore in the world, Vale has further pushed the prices down to IO62-CNI=SI by increasing year on year production at 4.9%. The price has dropped by 60% when compared to last year.
The company has reported production of nickel and coal at 69,200 tonnes and 1.7 million tons respectively in 1Q2015.
Vale appears to absorb price drop to get back its market share after the collapse of competition from the Australian manufacturers in the recent past.
The announcement came at a time when BHP Bilton, a largest mining firm in the world, decided to slow down its expansion plans sighting a steep drop in prices.
In a bid to reverse the steep decline in prices, Fortescue Metals Group Limited (ASX:FMG), an Australian rival, has requested iron ore producers to put a temporary ceiling on production.
According to Murilo Ferreira CEO, Vale SA (ADR) (NYSE:VALE), which is unfazed by the price drop, will go ahead with its S11D project, an expansion initiative for achieving the production of 90 million tonnes.
Vale divests majority stake in Belo Monte Dam to Cemig Geração e Transmissão SA
Vale has entered into an accord to sell 49% stake in its Belo Monte Dam to Cemig Geração e Transmissão SA, a power utility. Despite the sale, the company will hold the right to 9% of the energy produced in the dam.
Vale to divest Giant Ships to mobilize funds
Vale is considering the sale of large ships as it struggles with recent rout in iron ore prices. It is also likely to divest minority stake in its rail logistics operations.
According to sources, the company is considering to dispose of Valemaxes, a collection of large ore carriers. It may also consider divesting 43.8% stake in MRS Logística SA. The proposed sale will help Vale to fund Amazon based largest iron ore project.
