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Australia’s Iron Ore Eyed by Brazil’s Vale

Saturday, 25 February 2012 | 00:00
Unconfirmed media reports circulated Thursday that Vale, the world's second largest metals and mining company and global leader in iron ore production, is eyeing to buy into Australian iron ore resources to strategize its shipment schemes to the Asian market.
And this early, West Australian Premier Colin Barnett has expressed a welcoming statement for Vale. Nine news, quoting "media reports," said Vale is said to be interested in WA's Yilgarn region, located on Southern Cross that is best known for gold and nickel mining.
The Business Spectator, citing The Australian Financial Review, reported Vale wants to cut down on the costs of shipping the raw commodity to Asia, particularly to China. In fact, as part of shipment cost cuts, Vale had earlier invested in a fleet of ships to be able to send its iron ore to China more cheaply, by buying seven ore carriers from South Korean manufacturers. The first of these ships was delivered in 2011. It is the world's largest bulk carrier boasting of a 400,000 tonnes capacity.
"Vale is trying to diminish this handicap by investing more in Australia and eventually being able to sell iron ore from Australia straight to China," Rubem Antonio Correa Barbosa, Brazilian ambassador to Australia, told The Australian Financial Review.
"As a big producer, a big corporation providing capital and development of new projects, they're as welcome as anyone else," Mr Barnett said in a news conference on Thursday.
"I'd be (more) concerned if they would try to take over either Rio or BHP's operations."
Asked to authenticate the reports, Murilo Ferreira, chief executive of Vale, neither confirmed nor denied the mining company's expansion plans into Australia. It did not also give any specifics of neither a location nor a potential mining firm target.
"It is our duty to analyse all of the opportunities through junior companies," he told The Australian Financial Review.
Vale is the world's largest fabricator of iron ore and pellets and nickel, producing over 250 million tonnes and over 250,600 tonnes per year, respectively. The Brazilian miner is active in coal, potash, and all stages of aluminum production.
Vale expects its sales of iron ore and pellets to grow 4.3 per cent in 2012.
Source: International Business Times
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