Vale Producing Iron-Ore at Full Capacity as Demand Rebounds, Director Says

Vale SA, the world’s largest iron- ore producer, is producing the steelmaking raw material at full capacity as China-led demand rebounds, a director said.

China is starting to rebuild steel stockpiles, while the U.S. and Europe will likely increase inventories in the fourth quarter, Claudio Alves, Vale’s director for iron-ore sales in the Americas, said today at an event in Rio de Janeiro.

Global steel production rose 18 percent to 119 million metric tons in June, the World Steel Association said today in a report on its website. The cost of 62 percent iron ore delivered to the Chinese port of Tianjin, which fell to a six-month low on July 14, rose for a fourth day. It climbed 3 percent to $121.60 a metric ton today, according to The Steel Index.

Vale rose 4 percent to 40.08 reais in Sao Paulo trading at 11:44 a.m. New York time. It earlier gained as much as 4.5 percent, the most since May 27.

Iron-ore prices will likely rebound this year, Roger Downey, chief executive officer of MMX Mineracao & Metalicos SA, said today at the same event. MMX, based in Rio de Janeiro, is the iron-ore miner controlled by Brazilian billionaire Eike Batista.

MMX is “ramping up” production and adding capacity, Downey said.

To contact the reporters on this story: Peter Millard in Rio de Janeiro at pmillard1@bloomberg.net; Lucia Kassai in Sao Paulo at lkassai@bloomberg.net.

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