Vale: 2010 iron ore production at full capacity

Vale, the world's largest iron-ore supplier, is forecasting its iron ore production will reach full capacity next year, fueled by the global economic recovery. Vale's iron-ore production fell by about 30 million tons this year to 272 million tons, down from about 302 million tons in 2008. But Chief Execuive Officer Roger Agnelli believes that next year its iron ore output will will rebound to about 300 million tons. Agnelli says greater demand from China may bump up metals prices next year. Ahead of next year's price with the world's largest iron ore importer, Vale has signed independent ore contracts with Chinese steel mills for fixed freight charges. This year, China failed to reach an agreement with suppliers in price talks after the China Iron & Steel Association insisted on a deeper price cut than Rio Tinto and BHP Billiton had agreed with other Asian countries. Industrial analysts are expecting iron ore prices to rise about 10 percent to 20 percent next year on increasing demand as the global economy recovers. U.S.-traded shares of Vale, Rio Tinto and BHP have made gains recently. On Dec. 24, Vale settled up 1.40 percent at $28.90 and Rio Tinto closed higher at $215.20, up 1.6 percent. BHP closed up 0.9 percent at $75.90.