Rising iron ore prices could benefit Brazil’s trade balance

São Paulo – Higher iron ore prices are expected to benefit the Brazilian trade balance in 2021, drive up profitability of the commodity’s exporters and make ore-derived products more expensive. The reasons for rising ore prices are a decreased supply due to the pandemic and an ever-increasing demand. The commodity is currently worth as much as USD170 per tonne. Last February, it was worth USD78 per tonne.

According to data from Brazil’s Ministry of Economy, last year the country exported USD22.7 billion worth in iron ore, USD16.3 billion of which were to China, our main buyer. The previous year’s ore exports reached USD22.6 billion, being USD13.5 billion to China. Exports to Oman, where Vale has a pelletizing plant, reached USD560 million last year, down from the USD660 million exported in 2019 to the Arab country.