London-listed miners boosted after Vale halts operations at another mine

Mining companies on the London Stock Exchange (LSE) were boosted yesterday in the wake of embattled Brazilian miner Vale’s decision to shut another iron ore mine in Minas Gerais state.

The FTSE 100 was dominated by mining companies including Fresnillo, who ended the day up by 3.95%, as well as Antofagasta and Anglo American. Smaller listed firms such as Lonmin and Hochschild also made the top 10 across the exchange.

London’s blue-chip index rose 64 points higher to 7,355 on the back of gains made by companies in the resources sector.

Vale said yesterday it will halt operations at its Alegria iron mine in the Mariana complex, after a stress test failed to guarantee stability of the mine’s structures.

The company said it would restart production when new studies are completed and their results are conclusive, but the decision could take up to 10 million tonnes of iron ore a year off the market.

This is the latest in a long list of blows for Vale since the fatal tailings dam collapse at Brumadinho in Minas Gerais, which left over 300 people dead or missing.

Last week, Vale was forced to shut its Timbopeba mine due to safety concerns and later received a fresh order to halt another two dams — Minervino and Cordao Nova Vista.