Vale has suffered a fire at its distribution centre in Malaysia in another incident likely to disrupt global iron ore shipments.
The Brazilian mining giant said the incident took place in one of the transfer houses of the belt conveyor system.
“The fire caused material damage only and operations should be resumed in approximately 10 to 15 days,” Vale said in a statement.
“We expect reduced impact on its shipments, since a 10-day preventive maintenance was already scheduled at the terminal during the same period.”
Vale shipped around 1.8 million tonnes from its Malaysian distribution centre in February 2018, in what is described as a “very typical month” by Wood Mackenzie analyst Alex Griffiths.
“A 10 to 15 day unexpected shutdown translates to a 600,000 tonnes to one million tonnes reduction in exports. But we do not think average export volumes will suffer. Losses now can be made up next month.”
Griffiths said Vale ships, on average, around one vessel every two days from Malaysia but the distribution centre is capable of discharging one vessel daily.
“The export berth only has one ship-loader but it has a nominal capacity of 8,000 tonnes per hour — more than enough to fill a capsized vessel in a 24-hour operation,” he said.
“Therefore, if stocks are available — the stockyards have capacity of 3.2 million tonnes — the centre should be in a position to increase March shipments to make up for this loss.
“As Vale indicated a 10-day shutdown was coincidentally planned for this period, the most likely outcome is that the company can make up any lost tonnages in March.”
Most of the material from the Malaysian distribution centre is Brazilian Blend fines destined for China.
A significant delay in restarting operations would add to pressure on this segment of the market — already likely to suffer in response to reduced supply following the dam disaster on the 25 January.
