Vale SA CEO Fabio Schvartsman told Bloomberg News that the company is ready to use its idle 50 million-tonne iron ore capacity to help maintain market balance if prices become too high, the newswire reported Dec. 6.
"It was clear to see during the super-cycle, when in an unsustainable way companies made too much money and they didn't know what to do with the money," Schvartsman said, noting how higher iron ore prices would lure inefficient producers back into the market.
According to the report, Vale expects to produce 390 million tonnes of iron ore next year, and output is capped at 400 million tonnes over the following four years, compared to the company's annual production capacity of 450 million tonnes. Vale also anticipates lower costs in the coming years as new mines ramp up.
The company said it will lift its iron ore pellet output to about 55 million tonnes in 2018, compared to 50 million tonnes this year, and will reduce nickel production by 15% to 263,000 tonnes.