Vale swings back into the black on soaring iron ore prices

Brazil's Vale (NYSE:VALE), the world's No.1 iron-ore producer, profited from a sharp surge in iron ore prices that helped the company swing to a net profit of $525 million in the fourth quarter from a $8.6bn loss for the same period a year earlier.

The Rio de Janeiro-based company logged a net profit for the full year of $3.98 billion, a significant recovery from a loss of $12.13 billion it reported for 2015, the biggest in the miner's history.

"With strong production and the recovery in prices, it was forecast we'd have a strong quarter and finish the year strongly. And that's exactly what happened," Vale's Chief Financial Officer Luciano Siani said in a video on the company's website.

Unlike several analysts and even companies that predict iron ore prices are set fall sharply in the medium-term, Vale see the steelmaking material staying strong, down only to about $80 per tonne from the over $91 a tonne is currently trading.

According to company, the modest price correction will be the result of increasing steel demand and a smaller rise in new production entering the global market.

More to come…

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