On October 18, Brazil's Vale SA (VALE) released its production report for the third quarter of 2023. Among them, nickel production of 42,100 tons, an increase of 14.1%, down 18.7%. Nickel sales were 39,200 tons, down 2.7% quarter-on-quarter and down 11.5% year-on-year.
Nickel project - Detailed production analysis
Sudbury (Sudbury) : Nickel production decreased by 4,100 tonnes year-on-year due to unplanned maintenance at the Sudbury Refinery and unplanned maintenance at the Creighton mine. Year-to-date, Sudbury's ore production is up 16% year-over-year, in line with increased mine development.
Thompson (Thompson) : Nickel production decreased by 1,400 tons year-over-year as annual planned maintenance activities at Long Port were completed early in the third quarter.
Voisey's Bay: Scheduled maintenance at the Long Harbour refinery, depletion of the open pit Ovoid mine and an underground VBME project in a transition period of gradually increasing capacity have reduced finished nickel production from Voisey's Bay ore by 1,200 tons per year. The transition to underground mining continued as planned, with VBME ore production up 53% year-over-year and 43% sequentially.
Third party supply: Third party nickel consumption increased as planned and in line with the strategy of maximizing downstream business utilization and performance, nickel production increased by 100 tons year-on-year.
Indonesia: Nickel production from Indonesia fell 21,000 mt/yr due to increased production at the Clydach refinery following planned maintenance in the second quarter and the impact of regional water supply disruptions in July. Thanks to improved mine grade and furnace performance, PPTV's frosted nickel production reached 18,000 tons in 3Q23.
Onca Puma: Production was down 1,000 tonnes year-on-year. This is due to the furnace being operated at lower efficiency in preparation for the rebuilding of the furnace, which is scheduled to begin in the second week of October and continue until the end of the first quarter of 2024.
Nickel sales were down 5,100 tonnes year-on-year due to lower production. Nickel sales decreased by 1,100 tonnes quarter-on-quarter, mainly due to Onca Puma's ferro nickel reserve inventory, which was held to comply with sales commitments during the furnace renovation period.
Nickel now averaged $21,237 / tonne, down 2% year-on-year, mainly due to a 7% decline in the LME nickel reference price ($20,344 / tonne in 3Q23 versus $22,063 / tonne in 3Q22), offset by the positive impact of hedging results and higher average premium for Tier 1 products.
