Mining giants set to cash in as Brazilian rival Vale’s COVID woes pile up

Mining giants set to cash in as Brazilian rival Vale’s COVID woes pile up

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Australia’s big miners are set to cash in on surging iron ore prices as fresh coronavirus troubles hit their closest rival Vale, with analysts sceptical the Brazilian giant can meet its production targets.

Iron ore futures soared 5.6 per cent on Monday to $US102.95 per tonne, the highest point since August 2019, after a Brazilian court at the weekend ordered Vale to shut three mines at its Itabira complex in the south-east of the country, after nearly 200 workers tested positive for the virus.

Australia’s iron ore exports for the 2019-20 financial year are expected to be worth $81.5 billion, according to government forecasts and Vale’s Australian rivals – Rio Tinto, BHP and Fortescue Metals – are all primed to further benefit from the news as fears of a supply crunch push up the price of the vital steelmaking ingredient.

From their respective March intraday low to Friday’s close, BHP’s share price has climbed 50 per cent to $36.06, Rio Tinto gained 36 per cent to $98.60 and Fortescue’s price more than doubled to $14.54, including touching a new record high of $14.96 last week.Advertisement

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