On September 29, CSN Mineração issued an important notice regarding a temporary reduction in iron ore production at the dry processing plant of the Pires Complex located in Ouro Preto, Minas Gerais. This decision was made due to current market conditions, low iron ore prices, and high shipping costs.
Changes in Production and Cost Forecasts
Following this reduction, CSN Mineração revised its production forecast for 2026 from 45.0 to 47.0 million tons down to 39.0 to 41.0 million tons. Additionally, the forecast for cash costs C1 was increased from $22.0 to $23.5 per ton to $25.0 to $26.0 per ton. The company stated that this action is reversible at any time if profit margins for this mineral improve and does not expect it to have a significant impact on its performance.
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Iron Ore Production and Purchases
In the first quarter of 2026, CSN Mineração produced and purchased 10.058 million tons, and in the second quarter, 10.880 million tons, totaling approximately 20.94 million tons in the first half of the year. With the new forecast of 40 million tons, production in the second half will be around 19.06 million tons, which is approximately 1.9 million tons less than the first half and about 6 million tons less than the previous forecast. Part of this reduction is related to lower purchases by third parties compared to CSN's own mines.
Impact of Shipping Costs on the Market
Shipping costs increased after tensions in the Middle East escalated in late February, reaching $43.38 per ton on September 23. Mineração Usiminas (Musa) also became the first company to indefinitely shut down its Samambaia plant in Itatiaiuçu starting September 2, which accounts for about 30% of the company's 9 million ton annual capacity. The company announced that shipping costs between Brazil and China increased from $22 to $23 to a peak of $37 to $38 per ton.
Global Market Demand Forecast
Meanwhile, private mines like Itaminas also announced that their wet processing plant in Sarzedo will be shut down in October, and about 300 employees, nearly one-third of their direct workforce, will be on leave for one month. The company exports about 90% of its production. Overall, customs data shows that China imported 845.6 million tons of iron ore from January to August, a 5.6% increase compared to last year. Meanwhile, the inventory of imported iron ore at Chinese ports reached 145.5 million tons on September 25, which is a 12.4% increase compared to last year.
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