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Iron Ore February 25, 2019 12:30:05 PM

New Mining Resolution Likely to Disrupt Ore Supply in Brazil

Paul Ploumis
ScrapMonster Author
Further, Vale is likely to witness cut of around 50 Mt in planned iron ore production for 2019.
New Mining Resolution Likely to Disrupt Ore Supply in Brazil

SEATTLE (Scrap Monster): The new regulation released by the Brazil’s National Mining Agency (ANM) is likely to lead to supply disruption of iron ore from the country, says a new report published by Wood Mackenzie. According to the report, nearly 8 million tonnes of seaborne iron ore supply, excluding Vale, from the country is at risk.

The resolution passed by the ANM proposes to establish outright ban on all dams in the country built with the upstream method. It fixes the deadline for removal or decommissioning of all such dams as August 2021. The companies who own such dams have time until August this year to submit a technical decommissioning project, which must include proposals to reinforce existing structures or build new retention structures.

According to Wood Mackenzie, 35 out of the total 226 iron ore tailing dams in the country are likely to be impacted by the ANM regulation. Usiminas, Gerdau, Mineração Morro do Ipê and CSN are likely to contribute most to the supply disruption.

Further, Vale is likely to witness cut of around 50 Mt in planned iron ore production for 2019. The disruption of operations at Feijao mines following the dam collapse in January this year coupled with plans to decommission its upstream dams by 2022 are likely to impact Vale’s iron ore output, said Wood Mackenzie report. On the contrary, the report predicts that the ANM move will not have any major impact on global iron ore supplies.

Incidentally, the price of the steelmaking raw material has surged higher by almost 21% year-to-date.