Vale’s Q2 2016 Production Review: Decline In Iron Ore Output As Production Cuts Take Effect
Vale reported its production figures for Q2 2016 yesterday, with a decline in iron ore production the most striking takeaway from the report. After several successive quarters of reporting year-over-year increases in iron ore production as the company ramped up its iron ore output, production cuts from some of Vale’s higher cost iron ore mining operations instituted in the second half of last year have taken effect with the company reporting a 3% year-over-year decline in its Q2 iron ore production. [1] Vale had decided to cut around 25 million tons per year worth of lower margin iron ore production last year in response to plummeting iron ore prices, amid a global supply glut. [2] Whereas iron ore prices still remain subdued, production cuts from lower margin producers have eased the oversupply situation, arresting the decline in iron ore prices. Apart from the decline in iron ore production, Vale’s coal production stood 25% lower year-over-year as a result of geological instability issues at the Carborough Downs mine. Nickel production stood 17% higher year-over-year as production recovered from temporary outages last year, whereas copper production stood 2% higher year-over-year. Here is a summary of Vale’s Q2 production.
Have more questions about Vale? See the links below.
- Vale’s Full Year 2015 Pre-Earnings Report
- Vale’s Q4 2015 Earnings Report: Decline In Iron Ore Prices Negatively Impacts Results
- How Important Is China To Vale’s Iron Ore Sales?
- What Is China’s Share Of Vale’s Overall Revenue?
- What Is Vale’s Revenue & EBITDA Breakdown?
- What Is Vale’s Fundamental Value Based On 2015 Results?
- By What Percentage Has Vale’s Revenue & EBITDA Declined Over The Last 5 Years?
- By What Percentage Can Vale’s Revenue & EBITDA Increase Over The Next 3 Years?
- How Has Vale’s Revenue Composition Changed Over The Last 5 Years?
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- Vale’s Q2 2016 Production Report, SEC [↩]
- Vale Rallies Most in Month Amid Iron-Ore Supply Cut Plan, Vale News Release [↩]