(Minews) - Vale, the world’s largest iron ore exporter, will offer a new product — Brazilian Blend fines — to its contract customers by this month, a company official said Thursday, May 14.
Brazilian Blend fines, or BRBF, which will have typical iron content of 63.1%, will be a blended product of Iron Ore Carajas fines from the northern system and high silica ores from the southern system, said Cecilia Silva, Vale’s Commercial Marketing General Manager, Iron Ore, at a major iron ore conference in Singapore Thursday.
Brazilian Blend fines will contain typical 1.7% alumina, 4.6% silica, 0.035% sulfur, 0.06% phosphorus, 0.5% manganese, 0.5% and 2% loss on ignition level and will be blended in the distribution center in Malaysia.
A company official from Vale said that BRBF could be offered in the spot market for as soon as this week on either a fixed price of floating price basis.
It is not clear whether this new blend material would be offered directly to their contractual customers.
“We are looking at about 30 million mt of Brazilian Blend fines coming out annually,” the company source told Platts.
The distribution center has an iron ore blending capacity of 30 million mt/year, with the potential to expand up to 100 million mt/year, Platts reported earlier.
EXPECTED TO COMPETE WITH RIO’S PILBARA BLEND
Industry sources said BRBF, with its relatively low impurity and higher iron content, would pose a “strong challenge” to 61%-Fe Pilbara Blend iron ore fines, which is currently the most liquid medium grade fines in the market.
The Pilbara Blend fines, a flagship product of Rio Tinto contains typically 4% silica, 2.5% alumina and 0.08-0.09% phosphorous content, Platts record shows.
A contractual customer of Vale in central China said introducing BFBF marked a shift in strategy on relying on high Fe and low silica materials such as Carajas or other high silica such as Standard Sinter Feed Guaiba and Standard Sinter Feed Tubarao (SSFT).
Relying instead on a single blended product was a bid to better meet the needs of Chinese buyers who preferred medium-grade fines yet with lower impurities.
“By blending high Fe Carajas fines from the Northern mines with southern system fines, the miner is endeavoring to grab a fair share of the 60%-63.5% medium grade fines market, which is dominated by Newman and Mining Area C fines and in particularly the Pilbara Blend fines,” said the steelmaker source in central China.
The steelmaker source said the lower impurity content of BRBF will be popular with Chinese steelmakers who are facing mounting environment scrutiny from the government.
Sintering plants and pelletization units were named as the main polluting agents in China and Chinese steelmakers were seeking to rely more on higher Fe and lower impurities cargoes to meet their production needs.
Iron ore with lower impurities releases fewer emissions.
But some Japanese and South Korean iron ore buyers said the silica content for BRBF is “slighter higher” than their Australian counterparts, while a few Chinese steelmakers who used Australian products said it would take time to evaluate the metallurgical proprieties of this new product.
But other buyers said that the higher content could be mitigated as most buyers were expected to be the Chinese steelmakers.
“If you look at the combined alumina and silica content of the BRBF, it is only 6.3%, and it very competitive with PB fines that has 6.5%, not forgetting it has higher iron content,” said a source at a state-owned steelmaker in eastern China.
“Besides higher iron and comparative alumina and silica content, BRBF fines has lower phosphorous content than PB fines,” said another steelmaker source in central China, adding that lower phosphorous content iron ore will be important to Chinese buyers as high phosphorous content ores would incur additional cost during the steelmaking process.
