Mozambique Coal Mining: Vale Moçambique SA posts US$100 million loss in 2Q
Mining company Vale Moçambique recorded a loss of US$100 million in the second quarter of 2016, compared with a loss f US$112 million in the first quarter, according to its parent company, Brazilian group Vale.
The improvement of US$12 million in results in the second quarter was due to a drop in costs and expenses of US$58 million, according to the annual report and accounts for the second quarter.
The production cost per tonne of coal placed at the port of Nacala decreased by 39%, from US$168 in the first quarter to US$103 in the second quarter, “and there should be an even better performance in the coming quarters, with increased production in Nacala and Moatize II.”
The subsidiary of the Brazilian group also reported that the Nacala Logistics Corridor continued to expand its business as planned. The railway carried 1.655 million tonnes of cargo in the second quarter against 761,000 in the first quarter.
Vale Moçambique made 19 shipments through the port of Nacala in the amount of 1.567 million tons in the second quarter compared to 13 shipments and 982,000 tonnes in the first quarter.
In this period, the price of ton of Australian high grade coking coal increased from US$81 to US$84, similarly to other varieties, reflecting increased demand from China and constraints on global supply.
Overall, the coal segment led the Vale group to a loss of US$110 million in the second quarter 2016, which compares with a loss of US$93 million dollars in the first quarter.
In the second quarter the Vale group as a whole posted profit of 3.58 billion reais (US$1.094 billion), a decrease of 30% year on year and 43% compared to results in the first quarter.
The drop in results was due to the need to make provisions to honour the agreement signed in March by the company and by BHP Billiton in the amount of 20.2 billion reais to recover and compensate regions affected by the disaster occurred in Mariana, over the next 15 years, after the Samarco dam burst. (macauhub/BR/MZ)
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