Iron Ore Prices Gain as Vale Temporarily Closes Brazilian Port

The Australian Financial Review reported that iron ore prices saw gains this week after Vale (NYSE:VALE) temporarily closed one of its ports in Brazil due to alleged environmental breaches.
As quoted in the publication:

The court in Brazil’s Espirito Santo state ordered a halt to export and import activities through Tubarao after elevated levels of iron ore and coal dust were detected. Vale received the news from federal police “with surprise” and will use “all appropriate legal measures to ensure the re-establishment of its activities”, the company said in a statement Thursday.

Iron ore has plunged over the past three years as the world’s top producers including Vale and rivals BHP Billiton and Rio Tinto Group in Australia boosted low-cost supply, spurring a glut just as China’s growth cooled. The impact from Tubarao would be determined by the duration of any closure and how the legal case developed, according to Citigroup, which estimated that the facility handled about 110 million tons of ore a year. That’s about 8 per cent of global shipments, according to Bloomberg calculations.

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