Iron ore price hikes during the second semester of 2016 further encouraged growth from Brazil, the world's lowest-cost and second-largest exporting country. Cash margins increased by over 17% in 2016 which provided more than enough incentive for Vale to push on with its huge expansion plans. We estimate the country’s marketable production to rise by 6.4% in 2017 mostly as a result of Vale’s S11D ramp-up. But while Brazil's iron ore industry is faring better than most, it is far from being in boom times with falling investment, curtailments from junior producers and cost cutting being key themes. However, the benefits coming from cost-cutting measures are proving to be challenging as most efficiency and productivity gains were already reaped over the past two years. This, combined with a stronger Brazilian real and higher oil prices, will mean that Brazil's average total cash cost on a free-on-board (FOB) basis will increase by 2.3% in 2017.
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This Iron Ore Supply Summary report details key producers, production levels, costs and margins for iron ore assets in this country. It also analyses industry trends and themes, giving insight into future cost direction.
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Country report | Jun 2017
Brazil iron ore supply summary
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