By Paul Kiernan
RIO DE JANEIRO--Brazilian mining giant Vale SA is developing a
"green" blend of iron ore that will reduce carbon emissions from
blast furnaces, in a bid to capitalize on Chinese efforts to curb
pollution from its massive steel industry, an executive said
Thursday.
After China's government unveiled a set of reforms last November
that included a newfound environmental focus, Vale said premiums
for the high-quality iron ore it produces from some mines in Brazil
"spiked at the end of 2013 and will probably remain elevated during
2014."
Analysts say quality is the biggest advantage that Vale, the
world's top producer of iron ore, has next to rival companies in
Australia that are closer to the Chinese market. China produces
around half the world's steel and is by far the largest importer of
iron ore.
Jose Carlos Martins, executive director of Vale's ferrous
division, said the company will soon begin building inventories at
its $1.37 billion Teluk Rubiah distribution center in Malaysia,
expected to begin operating in July. Once stocks are in place, the
company will start delivering its "green" iron ore.
"We are defining a kind of blend that can reduce carbon emission
in blast furnaces in China," Mr. Martins said. "We don't know how
the market will see prices for this ore but we really believe that
the acceptance will be very good."
Write to Paul Kiernan at paul.kiernan@dowjones.com
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