Vale reported a significant drop in third-quarter nickel and cobalt production compared to the second quarter at nearly all of its operations. The third-quarter production problems guaranteed that Vale’s nickel and cobalt output for the first nine months was lower than in the comparable period last year.
Vale’s nickel production fell to 55,700 mt in the third quarter, down 15.9% from production of 66,200 mt in the second quarter and 23.4% lower than production of 72,700 mt in the third quarter of 2017. For the first nine months of the year, Vale’s nickel production fell 14% to 180,600 mt compared to 210,100 mt in the first nine months of 2017.
Vale’s cobalt production was 1,028 mt in the third quarter, down 21% compared to the previous quarter and 31% lower than in the third quarter of 2017. In the first three quarters, Vale produced 3,657 mt of cobalt, 12% less than in the first nine months of 2017 when it produced 4,160 mt.
Vale’s Canadian operations accounted for the biggest production shortfalls, with a annual scheduled maintenance shutdown at Sudbury and the transition of Thompson, Man., to a mine-mill operation (Thompson’s concentrates are being sent to the Sudbury smelter for further processing).
Vale expects fourth-quarter nickel production to be 60,000 mt compared to 55,700 mt in the third quarter.
Vale’s nickel sales fell to 57,300 mt in the third quarter, down 7% compared to the prior quarter and nearly20% below sales of 71,300 mt in the third quarter of 2017. Vale’s nickel sales for the first nine months fell 17.7% to 176,800 mt compared to 214,800 mt in the year-ago period.
Vale noted that nickel production at the Voisey’s Bay mine dropped by 1,100 mt to 8,400 mt in the third quarter compared to the prior quarter mostly because of “the strategic decision to decrease production output to extend the mine’s lifespan to match the Voisey’s Bay mine extension. Vale has revived the plan to invest $1.7-billion in expanding the mine life of Voisey’s Bay by 15 years through an underground mine expected to come onstream in April 2022.
While nickel production from Voisey’s Bay dropped 28.8% in the first nine months of the year to 38,600 mt, cobalt production from Voisey’s Bay jumped 30.6% in the first nine months to 1,345 mt compared to 1,030 mt in the first nine months of 2017.
Vale said it is currently studying options at its New Caledonia operations including “a revamped mining plan to enhance value generation from the asset and explore its cobalt potential in support of the EV batteries market.” The company hopes to reach a decision on plans for New Caledonia by yearend. Production of nickel oxide and nickel hydroxide cake at New Caledonia fell 8% to 6,900 mt compared to the previous quarter mainly because of lower ore deliveries from the mine and refinery limitations.