Brazilian mining giant Vale SA reported its profit soared in the first quarter from a year earlier amid strong demand from China, with some uncertainty for the rest of the year.
Vale (company mine pictured above) said net income was USD 5.5 billion in the period, up from USD 239 million in the first quarter of 2020.
Vale said demand from China could face an impact in the rest of 2021 because of environmental restrictions there, but added it that expected high prices for steel in and outside of China should also help support iron ore premiums.
Net operating revenue from China jumped to USD 7 billion in the first quarter of this year from USD 3.2 billion in the same period a year earlier, Vale said.
Demand for iron ore in China was stronger in the first quarter compared with a year earlier as the Asian country’s gross domestic product surged, growing 18.3% in the same period.
The rapid expansion of Chinese GDP was partly because of an economic slump at the start of 2020 caused by coronavirus pandemic-related social distancing measures.
Net operating revenue rose to USD 12.6 billion from USD 7 billion in the year-earlier period.
The company reported adjusted earnings before interest, taxes, depreciation and amortization of USD 8.4 billion, from USD 2.9 billion a year earlier.
The company said earlier this month that iron ore output rose 14.2% from the first quarter of 2020 and sales of iron ore rose 14.8% from a year earlier.