Competition for Australian iron ore sales looks set to ensure ongoing depressed commodity prices, as Vale announces its intent to double exports to China over the next five years.
Vale’s head of ferrous metals, Jose Carlos Martins, said the company plans to export 400 million tonnes of iron ore per year, well above the 270 million tonnes exported in 2013.
The world’s largest iron ore producer is also considering the purchase or hire of 230 additional ships for the Valemax fleet in order to cope with the higher volumes.
China does not allow Vale’s vessels to anchor off port in order to prevent impact on supply and prices.
Because of this Vale uses transit centres in Africa and the Philippines to bring ore to China, and is also building a facility in Malaysia to service the region.