BRAZILIAN mining firm Vale managed a return to profit in the second quarter, despite flagging commodity markets.
Profit climbed to $1.7bn (£1.1bn) in the period, up from a $3.1bn loss in the first quarter, and improving on the $1.4bn profit reported for the second quarter of 2014.
The group also posted record second quarter iron production yesterday, but with commodity prices continuing to struggle, revenue and earnings were down.
Operating revenues fell by 29.7 per cent to $6.7bn from $9.9bn in the second quarter of last year.
Vale said the quarter was “marked by a substantial reduction in cash costs, especially in iron ore”.The company said a lack of new construction projects in China was causing a slowdown in Chinese steel production, which in turn is hitting demand for iron ore.
However, Vale added: “Looking forward, we expect China’s real estate sector to improve with some recovery in house sales. Improvement in the property market will translate into more investments... and help balance the market in the near term.”