As we know, I triggered about a $30 rally in iron ore prices in the past week when I reminded the market that Vale was facing another possible dam bust and crisis (or it was thew wind). The news today is that that crisis ie easing swiftly:
- Brazilian regulators have inspected the Xingdu damn and left its risk rating at emergency level 2 which is not in danger of imminent collapse.
- “The parameters of the structure of the dam today have not changed compared to what we saw in September last year, when there was the last inspection. Therefore, we kept it at level 2,” said Claudinei Cruz, head of mining dam safety at ANM in a release.
- The Xingu dam was closed by ANM in March 2020, when it was put on emergency level 1. It was moved to level 2 after last September’s inspection.
This may pave the way for Vale to reopen the railway link that been closed limiting output at the Timbopeba mine. If not, Vale has also reaffirmed it can restore 80% of the output in 30-60 days using remote control trains:
