Cia. Vale do Rio Doce, the world’s second-biggest nickel miner, may announce further cuts to its Canadian nickel operations to contend with falling demand and to pressure workers in contract negotiations, analysts said.
Vale is set to start talks with workers at its Sudbury, Ontario, mine in April, before a planned maintenance shutdown in May. Analysts said Vale may seek to extend the shutdown to cut inventories while rescinding some worker perks. The company, based in Rio de Janeiro, announced last month a suspension of some Canadian nickel output because of falling demand amid the global slowdown.
Nickel supply has outpaced demand since February 2007, when the market had a deficit of 4,600 metric tons, according to data from the Lisbon-based Nickel Study Group. The nickel price used dropped 56 percent last year on the London Metal Exchange. Vale’s Sudbury operations account for 9.4 percent of global output of finished nickel.
Source: Bloomberg
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