Brazilian miner Vale has said it may have to implement contingency measures or eventually suspend operations due to the global spread of the novel coronavirus (2019-nCoV) pandemic around the world.
The miner made it clear, however, that "as of today, we have not suffered any material impact to our operations, logistics, sales or financial position, nor [have] any of our employees tested positive for coronavirus."
"As the outbreak develops [in] the regions where our operations are concentrated, we may face workforce-related operational difficulties and may need to adopt contingency measures or eventually suspend operations," the miner announced on Thursday March 12.
Vale made the announcement, it said, because a significant proportion of its revenues come from sales to customers in Asia (63% in 2019) and Europe (13.8%) and it therefore has to rely on an extensive logistics and supply chains, including ports, distribution centers and suppliers in regions affected by the pandemic.
Tight supplies from Brazil due to heavy rainfall in the country have supported iron ore prices so far this quarter, despite the 2019-nCoV outbreak.
Fastmarkets'
65% Fe iron ore index stood at $105.30 per tonne cfr China on Thursday March 12, up $0.3 0 per tonne day on day.
The index has averaged $105 per tonne so far in March, compared with an average of $97 per tonne in the same month a year ago.
In addition to Brazilian supply woes, market participants said the low stocks of iron ore at Chinese ports were indicative of a balanced supply-demand situation for the steelmaking raw material.
Portside stocks of iron ore in China stood at 119.11 million tonnes on Friday March 13, compared with 160.47 million tonnes in the week of March 20 last year, market sources said, citing local provider information.
Zihao Yu in Singapore contributed to this report.