On January 29, local time, VALE SA (VALE) of Brazil released its production report for the fourth quarter of 2023. Among them, nickel production in the fourth quarter of 44,900 tons, an increase of 6.7%, a decrease of 5.3%; Nickel sales of 47,900 tons, a decrease of 17.7%, an increase of 22.19%. The total output in 23 years was 164,900 tons, a decrease of 8% year-on-year.
Nickel production in the fourth quarter of 2023 was 5.3% lower than the same period last year. Vale disclosed that its 4Q24 year-on-year production reduction was due to the conversion of the Voisey's Bay nickel mine to underground mining and the shutdown of the furnace planned for the Onca Puma project.
Nickel project - Detailed production analysis
Sudbury nickel ore: Finished nickel production decreased by 1,100 tonnes year-on-year.
The main reason for the year-on-year decline in Sudbury mine production in the fourth quarter was that Creighton Mine carried out a longer period of maintenance on some mines, which affected the timing and magnitude of grinding ore materials. However, in view of the annual maintenance of the mine in the third quarter, production in the fourth quarter still increased by 1,900 tons from the previous quarter.
Thompson nickel ore: Finished nickel production increased by 800 tons year over year.
The Thompson Mine increased production during the quarter mainly due to the recovery of intermediates from its sediments and recycling.
Voisey's Bay nickel ore: Finished nickel production decreased by 1,100 tons year over year.
The decrease in production at Voisey's Bay in the fourth quarter was due to the slow transition from the depleted Ovoid mine to the underground VBME project, which increased the nickel content of mined ore by 2,200 tons year-on-year.
the Third Parties nickel: Finished nickel production increased by 1,600 tonnes year-on-year.
The supply of nickel ore from third parties meets Vale's strategic needs and helps it maximize the efficiency and performance of its downstream industries.
Indonesia nickel ore Project: Finished nickel production increased by 1,800 tonnes year-on-year.
The growth of the Indonesia project was mainly due to the increased supply of nickel matte. Nickel matte production in the fourth quarter was 19,100 tons, the highest level since the fourth quarter of 2021. The Indonesian project will continue to benefit in the future due to improved mine and furnace performance.
Onca Puma nickel project: Nickel product production decreased by 4,500 tons year over year.
The continued decline in production from the project is mainly due to the overhaul of the furnaces in the production area, which is expected to be completed in Q1 24.
Quarterly sales: Nickel sales outpaced production in the fourth quarter.
Sales in the fourth quarter totaled 47,900 tons, 3,000 tons more than production. But Vale said this was in line with expectations as it needed to sell some of its inventory to support the furnace redevelopment of the Onca Puma project.
Quarterly selling price: The average realized price of nickel during the quarter was $18,420 / t.
During the fourth quarter, Vale's average realized nickel price decreased by 13% compared to the same period last year, partly due to a 15.2% decline in the LME nickel price index during the year compared to the same period last year. But Vale's average realised nickel price is still 7 per cent higher than LME nickel prices, thanks to hedging and a higher share of Category I sales.